Strategic Sport Marketing

The fifth edition of Strategic Sport Marketing integrates sport marketing

frameworks, theory and practical cases to show students and practitioners
how to develop and execute successful sport marketing strategies.
The book explains contemporary sport markets, consumer behaviour,
marketing strategies and best practices in sport marketing in a clear,
comprehensive and engaging way. Built on a foundation of strategic
decision-making, it offers a truly diverse set of case studies, ‘sportviews’
and examples from national and international sports and events, including
Australian Rules (AFL) football, European soccer, Russian hockey, Grand
Slam tennis and the National Basketball Association (NBA). This new
edition is revised to align with contemporary sport marketing applications,
conceptualising sport as part of the experience economy and integrating
technology and digitalisation themes into the book, reflecting the increasing
focus on data and digital communications and media delivery of sport. It
encourages critical and practical thinking and problem-solving on the part
of the reader to help them improve their real-world professional practice.
This book is an essential course text for students of sport marketing and
management, as well as being a useful resource for all practitioners engaged
in the marketing, promotion or communication of sport organisations or
brands.
Additional teaching and learning materials are available to accompany
this book, including slides, class outlines and reflective questions and
answers for each chapter.

Adam Karg is Associate Professor of Marketing and Director of the Sport

Innovation Research Group at Swinburne University, Australia. His
research is focused on consumer behaviour, sponsorship, online
engagement, branding, media consumption and innovation in sport. He is
also President of the Sport Management Association of Australia and New
Zealand (SMAANZ).
David Shilbury is Foundation Chair of Sport Management and Director of
the Deakin Sport Network in the Faculty of Business and Law at Deakin
University, Australia. He is also a Non-Executive Director of Golf Victoria
and his research expertise is in sport governance, strategy and sport delivery
systems.

Hans Westerbeek is Professor of International Sport Business and Head of

the Sport Business Insights Group at Victoria University, Australia. He also
holds Professorial appointments in Brussels, Beijing and Madrid and serves
on various Boards.

Daniel C. Funk is Professor and Ed Rosen Senior Fellow at Temple

University, USA. He serves as Chairperson for the Department of Sport and
Recreation Management and is Professor of Marketing at Swinburne
University, Australia. His research investigates sport consumer experiences
to help organisations understand customer acquisition, retention and
expenditure.

Michael L. Naraine is Assistant Professor in the Department of Sport

Management at Brock University, Canada. His research focus is digital
sport management and marketing, examining strategy, fan engagement and
analytics related to new developments in the sport business landscape.
Strategic Sport Marketing
5th Edition

Adam Karg, David Shilbury,

Hans Westerbeek, Daniel C. Funk
and Michael L. Naraine
Cover image: efks / Getty Images

Fifth edition published 2022

by Routledge
4 Park Square, Milton Park, Abingdon, Oxon, OX14 4RN

and by Routledge
605 Third Avenue, New York, NY 10158

Routledge is an imprint of the Taylor & Francis Group, an informa business

© 2022 Adam Karg, David Shilbury, Hans Westerbeek, Daniel C. Funk and Michael L. Naraine

The right of Adam Karg, David Shilbury, Hans Westerbeek, Daniel C. Funk and Michael L. Naraine
to be identified as authors of this work has been asserted in accordance with sections 77 and 78 of the
Copyright, Designs and Patents Act 1988.

All rights reserved. No part of this book may be reprinted or reproduced or utilised in any form or by
any electronic, mechanical, or other means, now known or hereafter invented, including
photocopying and recording, or in any information storage or retrieval system, without permission in
writing from the publishers.

Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are
used only for identification and explanation without intent to infringe.

First edition published by Allen & Unwin 1998

Fourth edition published by Allen & Unwin 2014

British Library Cataloguing-in-Publication Data

A catalogue record for this book is available from the British Library

Library of Congress Cataloging-in-Publication Data

Names: Karg, Adam, author.
Title: Strategic sport marketing / Adam Karg, David Shilbury, Hans
Westerbeek, Daniel C Funk, Michael L. Naraine.
Description: 5th edition. | Abingdon, Oxon ; New York, NY : Routledge,
2022. | Revised edition of: Strategic sport marketing / David Shilbury,
Hans Westerbeek, Shayne Quick, Daniel Funk and Adam Karg. 4th edition.
London : Routledge, 2020. | Includes bibliographical references and
index.
Identifiers: LCCN 2021046944 | ISBN 9781032219097 (hardback) | ISBN 9781760878801
(paperback) | ISBN 9781003270522 (ebook)
Subjects: LCSH: Sports—Marketing.
Classification: LCC GV716 .S46 2022 | DDC 796.068/8—dc23/eng/20211023
LC record available at https://lccn.loc.gov/2021046944

ISBN: 978-1-032-21909-7 (hbk)

ISBN: 978-1-760-87880-1 (pbk)
ISBN: 978-1-003-27052-2 (ebk)
DOI: 10.4324/9781003270522

Typeset in Sabon
by codeMantra

Access the Support Material: www.routledge.com/9781760878801

Contents

Preface

PART I
Introduction

1 Introduction to sport marketing

PART II
Identification of sport marketing opportunities

2 The strategic sport-marketing planning process

3 Understanding sport consumers

4 Sport market research and strategy

PART III
Strategy determination

5 Sport brands and products

6 Sport and pricing strategies
7 The sport place
8 Sport and media distribution
 9 Sport promotion
10 Sport services: service quality and satisfaction
11 Sport sponsorship

PART IV
Measuring and managing sport marketing strategy

12 Implementation, ethics and future trends in sport

marketing
Index
Preface

The sport industry continues to change radically. Since the turn of the
2000s, sport has continued its evolution into a multifaceted industry, with
growing appeal to an ever-increasing number of stakeholders and
supporters. From the foundation of a localised activity for participants and
spectators to the current-day activity with truly global relevance, the
increasing scale of sport shows little sign of slowing. In growing numbers,
supporters and fans continue to demonstrate their allegiance to sport via the
tickets and merchandise they buy, the literature they read, and the media
content and experiences they watch and engage with. Creating and
exchanging value with participants and consumers is central to the success
of sport organisations, as well as the various other organisations and
corporations actively involved in the production and consumption of sport.
In this setting, what was once a clearly defined, stable activity has
transformed into a complex, technologically connected and constantly
changing industry. As well as professionalisation and commercialisation,
technology, along with social and globalisation trends, is among the
primary themes impacting sport.
This is the environment in which the current generation of sport
managers and sport marketing practitioners operate. The sport experience
presents more diverse consumer motivations and preferences for the sport
marketer to target. In fact, a feature of the last decade has been the
fragmentation and growth of how sport is delivered over physical, digital
and hybrid settings. This is made more complex by the fact that sport faces
competition not only from within its own ranks; it also continues to
compete for the consumer dollar with a vast array of entertainment, arts,
cultural and tourism activities as well as with a growing consumer appetite
for passive and active recreation. All of these provide viable alternatives to
the sport experience for the modern consumer.
 Given this cluttered environment, we should be clear that sport does not
attract consumers through serendipity, but rather through carefully
structured planning, creativity and perseverance. The notion ‘build it and
they will come’ is no longer appropriate. Successful sport marketing is the
implementation of clearly defined strategies that are rooted in perspiration
and inspiration, practice and theory, and art and science. Therefore, the
strategic management of sport has become a highly professional endeavour.
It is important to recognise the range of skills required to manage the
modern sporting organisation when preparing the educational framework
for future sport managers. Sport marketing remains a popular area of study
and vocation, viewed as exciting and attractive to generations of sport
managers as well those in areas aligned with, for example, event
management, brand management, marketing, media and public relations.
The challenge of preparing graduates and practitioners for the rigours of
sport management lies in balancing the emotion and tribal character of sport
with the need for an objective application of business principles. Modern
management of sport is more than just a response to traditional actions or
present realities. It encompasses a vision for the future, together with the
strategies and implementations required for bringing about that vision. It
also requires decision makers to fully understand the forces and relevant
contexts in order to balance complex priorities. For example, what is best
for the sport is not always what is best commercially. Decision making
therefore requires robust knowledge and context bases, as well as strategic
tools.
Books such as this one play an important part in this process. They are
constructed by groups and individuals who understand the sport experience
and what it means to play, watch and officiate – and who also understand
the meaning of management. In some instances, frameworks and practices
have been appropriated from other fields of endeavour, with those theories
and strategies resulting in successful sport experiences and organisational
outcomes.
This fifth edition continues, through the provision of theory and practical
examples, to encourage current and future generations of sport marketers to
develop skills and consider settings critical in the successful promotion of
their sport and brands. In particular, Strategic Sport Marketing is unique
from two perspectives. First, it continues to be the leading example of a
sport marketing text that truly integrates international examples. More
prominent in this edition than ever, readers will find a wider array of case
studies, ‘sportviews’ and examples from myriad national and international
sports and events. From Australian Rules (AFL) football to European
soccer, Russian hockey, Grand Slam tennis, minor league baseball and the
National Basketball Association (NBA), a concerted effort has been made
to include as many popular sports and events as possible. Second is the
continuing, conscious decision to place the text within a framework of
strategic decision making. The three major sections of the text underscore
this commitment.
Part II of Strategic Sport Marketing (Chapters 2 to 4) concentrates on
identifying market opportunities, focusing on the consumer and the ways in
which information can be gathered, collated and utilised in order to
establish an effective marketing management process.
Part III (Chapters 5 to 11) delves into determining the best strategies to
use when dealing with a particular component of the sport experience.
Grounded in recognition of the central role of the consumer as well as the
placement of sport in the experience economy, this section orientates a
focus on sport brands and products, pricing and distribution, with ‘place’
considered both in the form of physical spaces and in the mediated setting.
A focus on the sport promotion mix, customer satisfaction, and service
quality and sponsorship within the promotions mix is retained in this
edition. Throughout these sections, and reflective of the modern setting for
sport, technology and digital – including the opportunities and implications
of technology for sport marketing – are embedded as constant and
integrated themes, as opposed to standalone concepts or chapters.
Finally, in Part IV of the book Chapter 12 focuses on the ongoing
evaluation, adjustment and maintenance of the strategic marketing process.
We include in this chapter some scope for readers to both reflect and
forecast by including analysis of the structures by which sport marketing is
delivered, as well as commentary on the emergent themes that will impact
the current and future development of sport marketing strategies. These
include links to evolving marketing theory and a range of environmental
factors, of which technology and digitalisation, innovation and social
considerations are posited to be most critical. It is hoped that, as a closing
section to this book, this provides scope for reflection on how these areas in
particular will impact the frameworks and strategy development of the
earlier chapters, as well as informing the careers and responsibilities of
readers.
Collectively, this fifth edition of the book provides a seamless
comprehension of the integration of consumer, activity and process.
Strategic Sport Marketing is aimed at senior undergraduates and entry-level
graduate sport marketing students, while also being a useful resource for the
practitioner engaged in sport marketing. While the frameworks and case
studies provide obvious examples of how the text can be used and applied,
we hope this book will be used by sport marketing teachers and
practitioners not only to stimulate the thought processes but also to engage
with and improve the sport experience for the benefit of all concerned.
Finally, as it has done for decades, it is hoped that the utility of this text will
continue to stimulate literary contributions to the field of sport
management.
Adam Karg
David Shilbury
Hans Westerbeek
Daniel C. Funk
Michael L. Naraine
Part I
Introduction

DOI: 10.4324/9781003270522-1

CHAPTER 1
Introduction to sport marketing
CHAPTER 1

Introduction to sport marketing

DOI: 10.4324/9781003270522-2

Chapter objectives
Chapter 1 provides an introduction to sport marketing. Important foundations
are provided, including the definition of sport marketing and its role within the
sport marketing mix. A focus is provided on introducing drivers and trends
which have impacted the way that value is produced and exchanged in the sport
industry. Further, the unique characteristics of sport, and sport marketing, are
presented, and the increasingly central role of the consumer and their
experiences is articulated. As well as foundational aspects, the importance of
marketing to the broader discipline of sport management provides a setting for
the development of a strategic and considered approach to sport marketing.
After studying this chapter, you should be able to:

discuss the role of marketing in organisations

identify the marketing mix
describe the importance of marketing in sport organisations
describe the unique product features of sport and their impact on sport
marketing
define sport marketing.

Headline story
Evolving forms of cricket: the 100-ball game
 The year 2020 was a difficult one for the world as it struggled with the COVID-
19 pandemic. It was also slated as the year the English and Wales Cricket Board
(ECB) was to commence its new 100-ball offering, The Hundred, following a
trial match at Trent Bridge in 2019. Due to the pandemic, the introduction of
this potentially innovative product was postponed until 2021. The new offering
consists of up to 100 balls per innings, which can be bowled in batches (‘overs’)
of either five or ten consecutive balls. A bowler can deliver a maximum of 20
balls, with each fielding team allowed a 150-second tactical timeout. There is
one batting powerplay for the first 25 balls, in which only two fielders are
allowed outside the 30-yard circle. The new format, when it eventually got
underway in July 2021, was, as expected, fast and furious. Given the unique
new format, new tactics and approaches to this form of the game will naturally
evolve.
Although similar to Twenty20 (T20) cricket, The Hundred’s revamped form
of ‘overs’ and balls bowled provides enough differences for the ECB to be
confident that it would provide an alternative product to that seen in the Indian
Premier League (IPL) and Australia’s Big Bash League (BBL) via its Twenty20
season. Like these latter two competitions, for which city-based teams have
been formed especially, the ECB established eight men’s and women’s teams
representing seven cities to play in the inaugural competition over the English
summer in July and August. The 32 matches involved teams made up of UK
heroes and a range of high-profile international players. Squads of 15 players
are filled via a draft to help fuel public interest. ECB CEO Tom Harrison stated
on the BBC (2018) that ‘the strategy we have created will give the whole game
clear priorities’ and that ‘the outcomes for all of this combined work are vital
for the growth and sustainability of cricket, at all levels, in England and Wales’.

Marketing and the sport context

In the digital world of 2021 and beyond, many sports have emerged via the
growing range of broadcasting options to challenge for the position of global
dominance. Soccer has long remained unchallenged as the world’s most
globalised sport, a competitive advantage based on high levels of participation
and interest in so many countries throughout the world, resulting in soccer being a
highly sought-after broadcast commodity. Cricket, which is a popular but not
totally global sport, has sought consistently to expand its market by working to
identify new markets in developing countries and by varying its product to better
suit the needs of television. The introduction of the 50-over-per-team One Day
International (ODI) format was predicated on the need to expand the market by
providing a shortened version of the sport. Twenty20 cricket presents similar
dilemmas to those confronted when ODIs were first mooted as a serious
component of international cricket fixtures. Now, as shown in the headline story,
100-ball cricket is the next compressed form of the game designed to attract the
next generation of fans. The compressed format of the sport often leads to a more
exciting and intense style of cricket and, more importantly, a quick result. The
headline story highlights how cricket aims to broaden its product mix to ensure
the game remains relevant, with the hope that the compressed formats of the
game might transfer interest to the more traditional long form of the game, Test
cricket. Regardless, the revenues generated from Twenty20 and expected from
100-ball cricket provide national cricket governing bodies with the means to
continue to develop cricket in their respective regions.
Strategically, cricket has been struggling to find the right fit for its newest
product offerings. Significantly, its expanding product portfolio has created
tensions between the various forms of the game and, in relation to television, live
attendances as it tries to balance the needs of its broadcast partners against
income derived from attendances. The role of Twenty20 cricket and potentially
100-ball cricket in the product portfolio is clearly growing; but is Twenty20 a
legitimate form of the game that warrants a World Cup format? Logically, 100-
ball cricket could also warrant a World Cup at some point in the future. Indeed,
the Twenty20 world championship for 2020 was meant to be played in Australia
in October and November of that year, but COVID-19 prevented it from being
staged. Significant revenues for the game would have been at risk had the event
not been re-scheduled for October 2021, and moved to the Middle East.
Alternatively, is the prime role of Twenty20 or 100-ball cricket to entertain and
promote the wider features of the sport of cricket?
This is a classic strategic and competitive positioning question confronted by
many sport marketers in many different sports. Obviously, the three-hour, 20-
over-per-team or 100-ball format is more attractive to television than the two
other longer forms of the sport. Moreover, it is also more appealing to cricket
fans; but it may simply be redistributing fans among the various forms of the
game. In three hours, television executives can expect rapid-fire big hitting, lots
of wickets, thrilling catches and run-out opportunities, as well as constant
scampering between the wickets by the batters. All this action, plus a result
without having to hold the viewers’ attention for a whole day or more, is very
appealing.
Major changes have occurred to the competitive positions of a variety of sports
as a consequence of the media’s ability to show sporting competitions played in
all parts of the world. Domestic competitions also have increased in familiarity
through the media. For example, the former Victorian Football League (VFL) in
Australia has expanded from a 12-team, state-based competition to become an 18-
team national competition played in five states. Basketball, too, has capitalised on
its increased exposure, creating the National Basketball League (NBL) and
Women’s National Basketball League in Australia. Television and new media
generally have contributed to the emergence of new and restructured
competitions. Changing competitive conditions have forced sport managers to
develop more complex and subtle marketing strategies for their sports, based on
increasingly sophisticated means of sourcing data through a variety of business
analytic tools.
The purpose of this book is to examine the role of marketing within the sport
context. More specifically, it will consider the role of marketing from a strategic
perspective as an important product in the experience economy, highlighting the
ways in which marketing contributes to the growth and development of various
sports. Marketing assumes greater significance than other management functions
in sport organisations, as it remains the principal means by which sports compete
off the field. For instance, large firms such as BHP, PepsiCo and the Virgin Group
have the option to pursue acquisition-type strategies to build market share, or to
engage in product development, diversification or divestment. These strategies
generally are not available to sporting organisations, whose principal
responsibility is as national governing bodies, such as the Football Federation of
Australia, UK Athletics or the Board of Control for Cricket in India (BCCI). In
the broader context of the sport industry, major manufacturing firms such as Nike,
Adidas, Puma and Spalding are large firms that have the capacity to pursue
acquisition-based strategies. In sport, each governing body is responsible for a
specific code, and its charter is to develop and enhance that particular sport.
Product diversification may occur, but sport-governing bodies rarely use
strategies based on acquisition. This is particularly evident for club-based sport
systems.
The ECB’s consideration of the strategic role of 100-ball cricket is a classic
case of product diversification. A 100-ball league involving players from the UK
and high-profile players from other countries has strategic merit, although the
competition for different forms of cricket is intensifying given the similarity of
the two short forms of the game, at least in terms of attributes such as the length
and pace of the game. In other words, how many product variations can cricket
cope with strategically that deliver on enhancing the attractiveness of the game
and upsell interest to other longer forms of the game? The creation of this league
could diversify cricket’s television product offering, with obvious financial
benefits for the ECB from rights revenues. It also has the benefit of exposing the
next generation of cricketers to future forms of international cricket. Indirectly,
television is driving this strategy – largely in response to the competitive forces
emerging out of India (and other domestic Twenty20 competitions) in relation to
the creation of the IPL and the benefits accrued by the BCCI. The main product
of this new league is 100-ball cricket. As always, strategic decisions warrant
careful consideration of their impact to ensure that new forms of the game do not
simply cannibalise other forms of the game. The importance of marketing
strategy in sport management is illustrated in the opening headline story through
cricket, and is discussed further later in this chapter.

Marketing defined
Marketing, as defined by Armstrong et al. (2018, p. 4), is ‘the process by which
marketing organisations engage customers, build strong customer relationships
and create customer value in order to capture value from customers in return.’
The authors also note that ‘broadly marketing is a social and managerial process’
that seeks to create and exchange value with others. Engaging customers in the
digital world is the new ‘buzzword’ as myriad forms of social media allow
marketing personnel to build relationships with customers in ways that were not
possible pre-social media. The identification of consumer needs and wants
remains a critical aspect of the marketer’s role alongside how to engage, in the
case of sport, sport fans. Marketing strategies must be based on understanding
consumer behaviour.
In sport, it has been assumed that the original form of the game is naturally
attractive, and therefore satisfies consumer needs. An analysis of sporting
organisations in Australia shows this to be an outdated view, however. Many
sports have modified rules to make the games more attractive and, in the case of
cricket, ODIs and Twenty20 matches have become an important part of the range
of product offerings. One-Day International matches played throughout an
Australian summer have more readily satisfied consumer need for compressed
entertainment and a quick result – so much so that the Twenty20 BBL is now
considered more entertaining and an important part of the summer vacation
period in Australia. At junior levels, many sports have been modified
significantly to satisfy the desire of many more young people to participate.
Inherent in this change has been the recognition that juniors wish to develop
game skills through actual participation, to have fun, and in general to be with
their friends through the sport setting.
The sport marketer must identify what needs and wants are being satisfied
through the exchange process. Armstrong et al. (2018) identify the process of
exchange ‘as the act of obtaining a desired object from someone by offering
something in return’ (p. 8). What is offered in return for the sport consumer’s
membership fee or entry fee may include social interaction, physical activity and
an avenue for competition, health and fitness, as well as entertainment.
Identifying the needs of various segments of the population is the challenge
inherent in the early phase of the marketing process. Obtaining this information
will allow the sport product’s benefits to be communicated in such a way as to
define the sport’s positioning. For example, the product attributes of one-day
cricket and five-day Test match cricket are different, and are therefore likely to
attract different segments of the market.
Having established the range of product attributes in relation to needs and
wants, the sport marketer embarks on the challenge of effecting the exchange.
Sporting organisations must develop a mix of marketing strategies to influence
consumers to buy their products, via either attendance or participation.
Combined, the four variables of product, price, promotion and place are known as
the traditional ‘4Ps’ of marketing.

Defining the sport marketing mix

Figure 1.1 depicts the seven component strategies of the marketing mix,
composed of the traditional 4Ps of marketing plus the 3Ps of service – process,
people and physical evidence. These 7Ps form the nucleus of this book, and each
will be described in more detail in later chapters. A brief description of the 7Ps is
as follows:
Figure 1.1 The marketing mix

Product – ensures that product characteristics provide benefits to the

consumer (includes identifying the actual product).
Price – ensures that the product is priced at a level that reflects consumer
value.
Place – distributes the product to the right place at the right time to allow
ease of purchase.
Physical evidence – is the visual and/or tangible clues of the service product,
such as the design and construction of the facility and, in general, the
aesthetic appeal.
Process – represents the convergence of the marketing and operations
functions, and therefore affects real-time service delivery and quality.
People – are responsible for delivering the event and are a major
distinguishing quality factor in the consumption process.
Promotion – engages the customer in the sport experience through the
product’s ability to satisfy the consumer through communication, whether
 traditional advertising or social media, or personal selling, sales promotions,
sponsorship, public relations and promotional licensing.

In sport, the combination and implementation of these marketing mix variables

change due to the unique characteristics of the sport product. The most notable
change from the traditional 4Ps of marketing is not only in the expansion to 7Ps,
but in the order we recommend in determining marketing strategies for sporting
organisations – particularly those reliant on facilities to host the sporting contest.
This expansion and reordering also take account of the special features of sport
and are described in the next section.

Unique characteristics of sport and sport marketing

In 1980, Mullin identified, for the first time, a series of characteristics of the sport
product that affect the marketing process. Mullin argued that sport had progressed
from a form of institution that was simply ‘administered’ to a form of
organisation that required ‘managing’. In making this distinction, he noted that
sport had reached a phase in its development where it was incumbent on the sport
manager to be actively seeking ways to expand the revenue base of the
organisation. Typically, the administrator is responsible for maintaining the status
quo within the sporting organisation. The manager, on the other hand, is
responsible for assessing and evaluating environmental trends likely to affect the
organisation’s survival and, ultimately, its success. The modern sport marketer is
charged with one simple responsibility: to increase the sources of revenue for the
sport. The tools to achieve this will be discussed in later chapters.
Mullin later identified five special characteristics of sport marketing. In
examining these characteristics, he notes (1985, p. 106): ‘Almost every element
of marketing requires significantly different approaches when the product being
marketed is sport. Predictably, the critical differences lie in the unique aspects of
the sport product, and the unusual market conditions facing sport marketers.’
The five characteristics noted by Mullin are summarised in Table 1.1.
Interestingly, some of these characteristics reflect attributes associated with
marketing services. It is uncertain whether this was intentional; clearly, sport is a
service product. Service marketing implications for sport marketing will be
developed and integrated further throughout this text.
Table 1.1 Unique characteristics of sport marketing
Market for sport products and services

Sport organisations simultaneously compete and cooperate.

 Partly due to the unpredictability of sport, and partly due to strong personal
identification, sport consumers often consider themselves ‘experts’.

Sport product

Sport is invariably intangible and subjective.

Sport is Inconsistent and unpredictable.
Marketing emphasis must be placed on product extensions rather than the
core product.
Sport is generally publicly consumed, and consumer satisfaction is
invariably affected by social facilitation.
Sport is both a consumer and an industrial product.
Sport evokes powerful personal identification and emotional attachment.
Sport has almost universal appeal and pervades all elements of life – that is,
geographically, demographically and socioculturally.

Price of sport

The price of sport paid by the consumer is invariably quite small in

comparison with the total cost.
Indirect revenues (e.g. from television) are often greater than direct
operating revenues (e.g. gate receipts).
Sport programs have rarely been required to operate on a for-profit basis.
Pricing is often decided by what the consumer will bear rather than by full
cost recovery.

Promotion of sport

Widespread exposure afforded to sport by the media has resulted in a low

emphasis on sport marketing and, often, complacency.
Due to the high visibility of sport, many businesses wish to associate with
sport.

Sport distribution system

Sports generally do not physically distribute their product. Most sport

products are produced, delivered and consumed simultaneously at the one
location. The exceptions are sporting goods and retail and broadcast sport.
Source: Adjusted from Mullin (1985).

Consumer involvement
Perhaps the most readily identifiable characteristic is the ‘expertise’ demonstrated
by the sport consumer. On the one hand, this is a disadvantage, as every move
made by the sport manager and coaching staff is critically examined and
dissected. The ‘armchair selector’ syndrome is an issue within sport. It is,
however, one reason why sport is so popular. The pervasiveness and universal
nature of sport, and the ease with which the consumer identifies with the sport
product, compensate for the intensity with which the consumer follows sport.
Very few businesses in the world are viewed with such simplicity and such
personal identification by the consumer.

Unpredictability
As with most service products, the consumer’s interpretation and enjoyment of
the sport product are open to considerable subjectivity. Participation in and
attendance at sporting contests allows the consumer to gain varying forms of
gratification. For example, some spectators may enjoy the closeness of the game,
others the entertainment surrounding the game, and yet others the inherent
strategies of the contest. This makes it difficult for the sport marketer to ensure a
high probability of satisfaction, and hence repeat attendance. The intangibility
and subjective nature of participation and spectating clearly align sport with the
experience economy and the service industry specifically. No tangible product is
taken from the sporting contest – as opposed, for example, to the purchase of a
washing machine or similar goods.
The term ‘experience economy’ was coined in 1998 by Pine and Gilmore in a
Harvard Business Review article. In essence, the authors argued that the real
economic value for firms, and the relationship with consumers, was to be found
through meaningful experiences. In other words, how sport organisations can
better understand consumer experiences and what consumers seek via a ‘sport
experience’ and how it shapes their behaviour in terms of repeat, or increased,
purchase of the sport product. Pine and Gilmore stated:

An experience is not an amorphous construct; it is a real an offering as any

service, good, or commodity … To realize the full benefit of staging
experiences, however, business must deliberately design engaging
experiences that command a fee. (1998, p. 98)
In effect, the authors argue for a transition from selling services to selling
experiences. As will be shown later in the chapter when examining the evolution
of sport marketing, the challenge of this transition has been accepted by many
sports the world over. As an understanding of sport consumers has improved and
digital technologies enhanced, the concept and importance of selling an
experience and creating multiple points of engagement/attachment has been
embraced by many professional sports leagues and clubs.
These characteristics of the service experience are examined and extended
further in later chapters (Chapters 3, 5, 7 and 10 in particular) which focus on
understanding sport consumers and the sport experience, the sport product, sport
distribution through facilities in the context of service delivery and customer
satisfaction in sport. Understanding and managing consumer subjectivity during
the sport experience is all part of a sport marketing strategy to overcome the
unpredictability of the actual sport contest by ensuring the experience is positive
regardless of the outcome of the game or the quality of the contest.
Equally unpredictable is the actual sporting contest, which varies from week to
week. This heterogeneity is a feature of sport. It is the unpredictability of the
result and the quality of the contest that consumers find attractive and that shapes
the experience. For the sport marketer this is problematic, as the quality of the
contest cannot be guaranteed, no promises can be made in relation to the result
and no assurances can be given in respect of the performance of star players.
Unlike consumer products, sport cannot and does not display consistency as a key
feature of marketing strategies. The sport marketer therefore must avoid
marketing strategies based solely on winning, and must instead focus on
developing product extensions rather than on the core product (that is, the game
itself). Product extensions include the facility, parking, merchandise, souvenirs,
food and beverages, and, increasingly, digital platforms through which to engage
fans – in general, anything that affects spectators’ enjoyment of the event. In
Chapters 5, 7 and 10 we discuss the methods by which sport marketers can
develop and improve the quality of product extensions.

Competition and cooperation

Another feature of the sportscape is the peculiar economy that dictates – in
professional leagues at least – that clubs must both engage in fierce competition
and at the same time cooperate. This is necessary to ensure that each club’s
contribution to the league enhances the strength of the league. An unusual blend
of politics and competition emerges in sports leagues, often amplifying the
importance of the public relations function within promotions strategy, which is
explored further in Chapter 9.
Sponsorship
Sponsorship of sport is also a unique feature of the sport economy. While not
necessarily specific to sport, sponsorship has provided – and continues to provide
– an opportunity for commercial advertising by corporations and businesses.
Sponsorship represents the ‘industrial’ component of the sport product and is
manifested through commercial advertising of its industrial aspect.

Publicity
Complacency in developing adequate marketing strategies has resulted from an
almost unlimited amount of media exposure for many sporting clubs, leagues and
associations. Sport traditionally has been able to rely on publicity as its principal
form of marketing and promotion. The disadvantage of relying on publicity is the
amount of negative press that occurs during a season or major event. More
recently, major leagues, clubs and associations have become cognisant of the
need to develop an effective public relations (PR) strategy to counter the issues
that typically occur during a season or event. Once again, the rise of digital
platforms allows for the use of social media to manage these issues and is
examined further in Chapter 9. Social media can also be the used by consumers to
generate negative publicity, and this requires management by sport
marketing/publicity personnel in sport organisations. Unfortunately, sporting
clubs and athletes must contend with serious issues relating to drug use, gambling
and alcohol, and various other misdemeanours that attract the public’s attention.
This book views the public relations function as a very important aspect of the
promotional mix.

Distribution
The final characteristic relates to the distribution system used by sport. As with
most service providers, sports participation and spectating revolve around specific
facilities for specific sports. To attend a sporting contest, spectators must travel to
the venue – usually a major facility within a city. The actual facility becomes an
integrated component of the marketing function as the sport product is produced,
consumed and delivered at the same time at the same venue. Many facilities –
such as the Melbourne Cricket Ground (MCG), Pebble Beach golf course in
California, Eden Park in Auckland, the Wanderers and Ellis Park Stadium in
Johannesburg and Wembley Stadium in London – have developed an aura and
mystique as a result of heroic performances at the venues over the years.
As a consequence of developments in technology, the distribution system for
sport has undergone radical change during the past decade. It is now possible to
distribute a game to all parts of the country and the world via television networks,
pay television, the internet and other technologies such as mobile 4/5G networks
and streaming of sports programming. In general, however, the televised sport
product is different from the live event. The mix of benefits is slightly different in
each mode of consumption.
Due to the relatively stable nature of distribution (i.e. one major stadium per
sport per city), it is vitally important to locate teams and facilities so that they are
able to compete effectively in the market. In Australia, product distribution has
been the focus of intense debate over the past 30 years. This is particularly
evident in the expansion of the former Victorian Football League (VFL) to
become the Australian Football League (AFL). In the early 1980s, the VFL was a
12-team, state-based competition primarily located in Melbourne. By 1991 the
league had changed its name to the AFL as it had relocated the South Melbourne
Football Club to Sydney and admitted the Brisbane Football Club and West Coast
Eagles Football Club in 1987, followed by the Adelaide Crows in 1991. By 1995
a second team from Western Australia (Fremantle) had joined the competition,
and a second team from South Australia (Port Adelaide) entered in 1997. In 2011,
the Gold Coast Suns were admitted to the competition, followed in 2012 by
Greater Western Sydney, which served to increase local competition from a
marketing perspective in Southeast Queensland and the city of Sydney. However,
nine teams remain in Melbourne, a city of approximately 5 million people. While
this is an example of a league reconfiguring its distribution, once established it
should remain relatively stable despite obvious over-capacity in Melbourne.
A comparison between the United States and Australia illustrates just how
important location of the product is in terms of developing appropriate marketing
strategies, particularly in view of the substantial population differences between
the two countries. The United States has a population in excess of 330 million,
compared with Australia’s 25.5 million. The US national competitions of
basketball (National Basketball Association, NBA), football (National Football
League, NFL), baseball (Major League Baseball, MLB) and ice hockey (National
Hockey League, NHL) have evolved past the point of over-capacity in any one
city. Significantly, the three major markets of Greater New York, Los Angeles
and Chicago (each with a population of 10–20 million) all host professional
franchises. However, not one of these markets hosts more than two teams of any
one code. The importance of marketing as a revenue-generating activity for the
clubs is important in this issue of location. Over-capacity intensifies competition
and reduces the available income for each of the teams located in any one
common market. This issue is on display in Sydney with the arrival of the second
AFL team, Greater Western Sydney, in a market that traditionally has not been a
stronghold for the AFL. Marketing strategy will play just as important a role as
on-field performances in the early years as the club strives to establish its
presence in Sydney, attract spectators and build loyalty leading to club
membership sales.

Importance of marketing in sport management

As indicated earlier in this chapter, marketing plays a key role in the sporting
organisation’s overall planning efforts. This has not always been the case. The
professionalisation of sport during the past 35 years has raised the level of
importance of the marketing function.
For much of sport history, volunteers have administered organisations in the
true spirit of amateur participation. As sport systems founded on club-based
models evolved from amateur to professional clubs, leagues and associations
there was a lengthy transition period between what is described as ‘kitchen table’
administration and professional management. In Australia, this was the period
pre-1970. As Figure 1.2(a) illustrates, during this period of voluntary
administration, the marketing function was non-existent. The predominant tasks
were to ensure the ongoing operation of the club, league or association.
Administrators adopted a very narrow view of their organisation, preferring to
concentrate on internal operations. Typically, administrators dealt with only half
of the accounting and budgetary process: the allocation and control of
expenditures. Even as sporting organisations began to professionalise, the
administrator ‘culture’ lingered for some years.
 Figure 1.2 Importance of sport marketing.

Figure 1.2(b) displays the progressive movement away from administration to

management of organisations. One of the manager’s main tasks is to monitor
environmental trends and plan for the organisation’s ongoing growth. Sport was
very reluctant to embrace proactive growth. The dispute between the Australian
Cricket Board (ACB – now Cricket Australia) and Network Nine’s owner (at the
time) Kerry Packer over television rights, and the players’ push for improved
remuneration and playing conditions in 1977, are examples of a major sport
adopting narrow internal perspectives. The introduction of colour television was
an example of a technological change ignored by the ACB. The advent of
Packer’s World Series Cricket (WSC) subsequently proved to be the catalyst that
forced sporting organisations in Australia to embrace a greater range of business
functions. This view is supported by Halbish (1995), who notes that ‘looking
back traditional cricket had grown out of touch with the fast emerging
professionalism of sport in Australia’ (p. 3). By 1980, WSC and the ACB had
reconciled their differences; however, from that point marketing was to become
an important element of business activity in sport.
Interestingly, during 2007 the BCCI was fighting a similar battle to that fought
by the ACB 30 years earlier. In 2007 a privately financed Indian Cricket League
(ICL) was being formed, with its first tournament held in October 2007 using the
lively Twenty20 format, following the officially sanctioned International Cricket
Council (ICC) Twenty20 World Cup in South Africa. The ICL had also signalled
its intentions to organise traditional 50-over one-day matches in the future.
However, the ICL folded in 2009 as the BCCI-controlled IPL gained ascendency
and domination of the Indian Twenty20 cricketing landscape, a position it now
dominates on a world scale. Nevertheless, once again, a rival competition from
outside traditional structures caused a wave of change in the sport.
Myriad issues arise here, not the least being who players are contracted to, and
who controls cricket, in India. As was the case in Australia many years earlier, the
plight of the players was central to these issues, with full-time professional
athletes requiring financial security. More importantly, the increasing importance
of the media, and revenues from new and old technologies, drove the ICL and the
need to fill airtime and boost pay-TV subscriptions. India is a developing country,
with an under-developed sporting infrastructure. These issues and others are
certain to surface during these times of transition to professional sport.
Initially, marketing activities in Australia were outsourced by a number of
sports. The ACB, for example, granted marketing rights to a company known as
PBL Marketing. Lynton Taylor, the managing director of PBL at the time, made
the following observations about the status of marketing and sponsorship in sport
following the reconciliation:

Five years ago, the Australian Cricket Board did not have a published
program … Last year more than 300 000 copies of the ACB program were
sold and this year almost 20 publications will be on sale. Work has also been
put into merchandising … it has taken five years to develop 29 licensees, but
this season we expect cricket merchandise to top $5 million in retail turn-
over and to start producing a satisfactory level of return. (Taylor, 1984, p.
13)

Figure 1.2(c) demonstrates the importance that marketing has taken on, despite a
long period of resisting the need to promote and nurture new and fertile markets.
For the first time, the identification and nurturing of new markets brought
recognition that the customer is central to ongoing organisational survival. Sports
had to find ways of generating revenue to sustain the growing costs of
professional competitions. One-day cricket is an example of modifying the
product to increase market share for the sport, as is the recently introduced
Twenty20 cricket and its attractiveness as a televised product as exemplified
through the ICL BCCI dispute in India. Focusing on consumer needs and wants
via increasingly sophisticated marketing research, sport organisations have
continued to develop strategies based on consumer information. Many of these
developments focus on product extensions and how to use digital platforms and
social media to engage fans, although changes to game formats and rules are also
common.
The centrality of the consumer and recognition of the importance of the
experience have been even more important due to the evolving spectrum of social
media. Focusing on consumer needs has evolved further to customer or fan
engagement. Figure 1.2(d) shows the need to understand the sport experience and
its relationship to customer/fan engagement as a pivotal feature of contemporary
sport marketing communication strategies – largely the result of evolving digital
platforms and social media outlets. Kaplan and Haenlein (2010) created a
classification scheme of the different types of social media that illustrates why
sport organisations have now moved to capitalise on the opportunity to develop a
closer sense of involvement with fans. Their six categories include: collaborative
projects (Wikipedia, Dropbox); blogs and microblogs (Twitter); content
communities (YouTube); social networking sites (Facebook); virtual game worlds
(fantasy sports); and virtual social worlds (Second Life). Of these social media
outlets, the creation of fantasy sports and more recently esport has become very
popular with sports fans as they seek to simulate the real-life experiences of team
management and engage in sport contests virtually. Esport and the other forms of
social media will be developed further in later chapters, and it is in this area that
the most significant changes to marketing strategies used by sport organisations
can be observed.
It was clear that during the COVID-19 pandemic esport (both formal and
highly informal) assumed a heightened level of interest to replace the live sport
experience with a virtual one. The digital revolution has continued to provide
ways to engage fans and provide deeper experiences through the sport product.
For example, in 2020 Formula 1 (F1) launched the F1 esports virtual Grand Prix
series, which ran from March to May, in which a number of high-profile F1
drivers participated. In the absence of live F1 races due to COVID-19, Formula 1
was able to provide a meaningful experience for F1 fans with the intent of
engaging its large fan base across the world. When watching the virtual races, one
could be forgiven for thinking they were the ‘real races’ which were simulated on
regular F1 racetracks, such as the first virtual race scheduled using the Bahrain
track. The digital revolution has deepened the potential to connect with fans; and,
as a consequence, sport marketing has evolved to a more sophisticated
understanding and implementation of the relationship between the sport
experience, service delivery and fan engagement. The aim of these experiences is
to develop multiple points of attachment to a sport code or club. It is also an
example of product extensions based on the core product, which will be
considered in more detail in Chapter 5.
Together with sport operations (that is, all that surrounds the management of
fielding a team), marketing is a sporting organisation’s principal ground for
identifying and creating a competitive advantage. Normal acquisition-type
strategies associated with for-profit firms are not so readily applicable to sport.
Internal growth strategies tend to be the major ground on which sport competes.
These strategies are developed further in Chapter 2.

Ethical behaviour
Increasingly, commercial pressures create tensions for the sport marketer. That is,
sport marketing executives often find themselves caught between an opportunity
to generate revenue for their sport and the consequences of changes that might
accompany these revenues. Consider, for example, the staging of an Olympic
marathon during the middle and hottest part of the day because a television
network asks for it to be staged at that time to maximise ratings. What do you do?
Clearly, scheduling the marathon at this time will not be in the best interests of
the athletes. Alternatively, what do you do if you work with the National Rugby
League (NRL) and the strategic goal is to reduce the number of clubs in the
competition? This was a real-life dilemma, as the South Sydney Rugby League
club was removed from the competition as part of a rationalisation strategy. The
club subsequently won the right, through a protracted legal battle, for readmission
to the NRL competition from 2002. As a sport-marketing manager, with the goal
of maximising revenues for the competition, how do you balance commercial
interests against the social and community interests in the South Sydney club?
These two examples illustrate ethical dilemmas, which are practical problems
requiring solutions – often involving equally compelling reasons to act one way
or another. In essence, the sport manager must determine the right thing to do
without a definitive ‘rule book’ available to guide decision-making.
Although space precludes a detailed analysis of ethics and corporate social
responsibility here, sport managers must consider their actions within a broader
societal framework. DeSensi and Rosenberg (2010, p. 135) note that:
 recognition of ethics and social responsibility has increased in recent years
… as a sport manager, learning to adopt a social consciousness leading to a
commitment to being socially responsible is paramount … Questions
regarding the nature of the complex relationship between society, sport and
the formal organisations of sport are raised within social responsibility.

Given the significant standing of sport in Australian culture, as a social institution

and indeed in many countries of the world, community expectations in relation to
the behaviour of sport managers are often high. There are many examples of sport
marketing decisions that create ethical tensions for individuals, and collectively
for organisations, wishing to be good corporate citizens. Some of these are
explored in this book – in particular in the chapters on sponsorship, where
ambush marketing is a source of considerable ethical frustration for managers.

Sport marketing defined

The term ‘sport marketing’ was first used in the United States by Advertising Age
in 1978. Since then, it has been used to describe a variety of activities associated
with sport promotion. Two distinct streams exist within the broad concept of sport
marketing: marketing ‘of’ sport and marketing ‘through’ sport.

Marketing ‘of’ sport

This refers to the use of marketing mix variables to communicate the benefits of
sport participation and spectatorship to potential consumers. Ultimately, the goal
is to ensure the ongoing survival of the sport in rapidly changing environmental
circumstances. This aspect of marketing has only recently developed in sport
organisations. Survival depends largely on the principal purpose of the sport
organisation. National sport organisations predominantly associated with elite-
level professional competitions will be striving to develop their marketing mix to
ensure that the sport product is attractive as a form of live entertainment and live
broadcast via television, streaming via the internet and other mobile outlets.
Sports governing bodies will also be responsible for ensuring that participation in
their sport remains healthy. Participants are the lifeblood of sport, as they become
the next generation of champions and spectators.
We do not make any notable distinctions in this book between marketing
strategies specifically pursued for either spectator or participant sport. The
theories posited are equally applicable, regardless of the principal objective of the
marketing strategy. As with all marketing strategies, when the objectives change,
the actions or strategies used to achieve the objectives also change. The
application of the marketing mix does not, although various components of the
mix may assume more importance in the two different scenarios. For example,
the outlets used to advertise a junior sporting competition may be different from
those used to advertise a major (professional) sporting event. Students of sport
marketing should adapt the concepts of sport marketing to either situation
because each is vital to the ongoing survival and financial well-being of
individual sporting organisations.

Marketing ‘through’ sport

Sponsorship of sport by firms is an example of marketing ‘through’ sport. Large
corporations use sport as a vehicle to promote and advertise their products,
usually to specifically identifiable demographic markets known to follow a
particular sport. Sports with significant television time are very attractive to firms
seeking to promote their products through an association with sport. Developing
licensing programmes is another example of marketing through sport. Typically,
major companies pay for the right to use a sport logo to place on their products to
stimulate sales.
Although the main emphasis of this book is on marketing ‘of’ sport, the role of
corporate sponsorship and licensing in sport marketing is also examined.

Definition
Given these perspectives, and information pertaining to marketing in general, the
following definition of sport marketing is offered:

Sport marketing is a social and managerial process by which the sport

manager seeks to engage customers in the sport experience, build strong
customer relationships and create customer value in order to capture value
from customers in return.

The exchange of value with others recognises the importance of the sport
consumer. The many different types of sport consumer are discussed in more
detail in later chapters of this book.

Overview of this book

The ability to recognise the needs and wants of consumers does not necessarily
imply action. It is the action associated with the marketing process in sport that is
the focus of this text. This is known as the marketing management process, which
is described by Armstrong et al. (2018) as ‘the art and science of choosing target
markets and building profitable relationships with them. The marketing
manager’s aim is to attract, engage, keep and grow target customers by creating,
delivering and communicating superior customer value’ (p. 9).
From a managerial perspective it is the rational and methodical planning
required to build and maintain beneficial exchanges with target buyers for the
purpose of achieving company objectives. In this book, the 7Ps of marketing
guide planning for marketing strategy, noting the special emphasis on
understanding how sport fans engage with sport as an experience, and the service
delivery features of the sport product. This book also adopts a global perspective
of sport, providing examples from many sports worldwide, which also provides
differing contexts and systems in which sport exists.
This chapter has defined marketing and sport marketing, as well as introducing
the unique characteristics of sport and how they impinge on the marketing
process. The remainder of this book is divided into three parts:

The following three chapters examine how the sport marketer identifies
marketing opportunities. Chapter 2 examines the place of marketing in the
planning process, and specifically reviews the strategic sport-marketing
planning process; Chapter 3 concentrates on understanding the sport
consumer and the sport experience; and Chapter 4 focuses on market
research and strategy, and the implications this information has for
segmenting the sport marketplace.
Chapters 5 to 11 then cover the strategy determination stage. They examine
the sport marketing mix and the way in which the organisation is positioned
in relation to target markets. Selection of the core marketing strategy is
significant in this stage, and the contribution of the 7Ps – product, price,
place, physical evidence, process, people and promotion – to strategy
determination is examined. The issues specific to sport marketing contained
in these chapters include: sport brands and products; sport distribution and
the role of the place through the venue or facility (physical evidence,
process, people and service); distribution via media; sport promotions;
service quality; customer satisfaction and engagement; and sponsorship and
its impact on sport marketing.
Finally, Chapter 12 returns to the important marketing management process
of implementation and evaluation. This chapter focuses on managing sport
marketing strategy which examines measurement of sport marketing
activities, control, marketing roles and structures, as well as ethical
considerations. This chapter also considers environmental drivers introduced
 early in the book to challenge thinking in relation to the changing nature of
sport marketing in the global setting.

References
Armstrong, G., Adam, S., Denize, S., Volkov, M., & Kotler, P. (2018).
Principles of marketing (7th edn). Pearson, Melbourne.
BBC (2018). 100-ball cricket: New short-form competition confirmed by
ECB. https://www.bbc.com/sport/cricket/46387938.
DeSensi, J.T., & Rosenberg, D. (2010). Ethics and morality in sport
management (3rd edn).Fitness Information Technology, Morgantown, WV.
Halbish, G. (1995, August). Developing professional sporting leagues.
Keynote address to the Sport Management and Marketing Conference,
Sydney.
Kaplan, A.M., & Haenlein, M. (2010). Users of the world, unite! The
challenges and opportunities of social media. Business Horizons, 53(1), 59–
68.
Mullin, B.J. (1980). Sport management: The nature and utility of the
concept. Arena Review, 3(4), 1–11.
Mullin, B.J. (1985). Characteristics of sport marketing. In G. Lewis & H.
Appenzellar (eds), Successful sport management. Michie, Charlottesville,
VA, 101–123.
Pine, J.B., & Gilmore, J.H. (1998, July–August). Welcome to the experience
economy. Harvard Business Review, 97–105.
Taylor, L. (1984). The marketing and sponsorship of sport in Australia.
Sports Coach, 8(2), 12–14.
Part II
Identification of sport marketing
opportunities

DOI: 10.4324/9781003270522-3

CHAPTER 2
The strategic sport-marketing planning process
CHAPTER 3
Understanding sport consumers
CHAPTER 4
Sport market research and strategy
CHAPTER 2

The strategic sport-marketing

planning process

DOI: 10.4324/9781003270522-4

Chapter objectives
 Chapter 2 identifies and describes the three stages that make up the strategic
sport-marketing planning process. Within these stages, eight steps are isolated
as constituting the marketing planning sequence for sport organisations. Steps
1–4 and 7–8 are reviewed in this chapter, with the other steps covered in the
remaining chapters. This includes a focus on tools to assess external
environment forces as well as internal publics. In sport organisations, the
strategic sport-marketing planning process assumes great significance because
these organisations are often one-product entities, and therefore organisation-
wide planning and marketing planning often become the same process.
After studying this chapter, you should be able to:

understand the strategic sport-marketing planning process

recognise the role of strategic sport-marketing planning in sport
analyse the forces driving industry competition
conduct a SWOT analysis
recognise the principal strategies available in sport marketing.

Headline story
A new ‘super’ rugby alternative for Australia
The Super Rugby competition has undergone continued change since its
inception in 1996. This has included expansion and reduction in the number of
teams, involving representation from Australia, South Africa, New Zealand,
Japan and Argentina. Most recently, difficulties presented by the COVID
pandemic accelerated calls for a rethink of the domestic competition for
Australian rugby.
As part of reports during 2020, Rugby Australia (RA), the national governing
body for the sport, received recommendations to abort its role in the current
Super Rugby format (Robinson, 2020; NZ Herald, 2020). The reports and
commentary focused on two key issues: decreased interest in the competition in
its current form by local audiences, and decreased performance of the national
team.
While consumption preferences for rugby remain strong for New Zealand
and South African audiences, data highlighted audience drops of over 40 per
cent since 2013, including drops of over 70 per cent in the 16–39 age group (NZ
Herald, 2020). This led to consultancy group Gemba suggesting that ‘Australian
fans just aren’t interested in the tournament enough to justify its current place in
 Rugby Australia’s priorities’. Further, it was suggested that change to the
competition could arrest the declining competitiveness of the Australian
national rugby team, the Wallabies. Assessment of the Test match performance
of the Wallabies pointed to a win rate of 68 per cent over 1996–2005, compared
to 45 per cent over the 2016 to 2019 period (Robinson, 2020).
In responding to issues of fan interest, recommendations for change included
a larger focus on domestic competitions. Reports noted the potential for
alternative models focused on local clubs or teams, leveraging heritage and
history, emotional rivalries, tribalism and geographic identity. Commentary on
elite development pointed to northern hemisphere rugby competition models
that have provided better outcomes for national team performance. Gemba CEO
Rob Mills (cited in NZ Herald, 2020) noted that:

One argument about the UK model is that a broadening of the depth of

professional players can also drive better test performance. If you had a
scenario where you saw private money focused on creating a really vibrant,
results-driven club system you could then have Rugby Australia focused
on pathways and Wallabies, as a traditional governing body does around
the world.

Concerning the need for change, Mills suggested the current problematic model
was ‘laid bare a little’ by the impact of COVID-19. There are though, wider
considerations for the elite professional completion. Will Australian Rugby’s
future really be local?

The most obvious question of strategic importance to emerge from this headline
story concerns how Rugby Australia will construct its elite domestic competition
schedule in order to maximise revenues and build a player pathway that leads to
success for the Wallabies. What is clear is that both a revamped player pathway
and marketing strategy combine to provide strategic direction. Interestingly,
during 2020, COVID-19 forced RA to run an elite domestic competition, given
that international travel bans effectively brought to a halt the Super 15s
competition.
Given the previously growing profile of rugby union, via the Super 15s and
successful World Cups in 2011, 2015 and 2019, RA’s once stated desire to
become Australia’s main winter sport is proving to be somewhat ambitious; but it
is an example of how sporting organisations need to map out their strategies and
adopt a systematic approach in order to achieve their stated goals. Consider the
competitive marketplace for the football codes in Australia, which include the
AFL, the NRL and the A-League (soccer), which has been played in spring and
summer to avoid the competition provided by the AFL, the NRL and the Super
15s. It is apparent that RA will have to know its market. It is clear, however, that
rugby’s dream run has begun to grind to a halt in recent years. As already
indicated, rugby had made considerable progress in Australia until the turmoil of
2020.
With competition intensifying due to the move by both the NRL and the AFL
to national competitions during the 1990s, rugby’s response has been to capitalise
on its international prominence through the Tri-Nations Series and Bledisloe Cup
matches against New Zealand. Test matches, with the advent of Stadium
Australia and its 80,000-plus capacity, boosted rugby’s ability to stage mega-
events. In addition, the Super 15s has been the key strategy that has lifted the
profile and image of rugby in Australia. The Super 15s competition – an alliance
between Australia, South Africa and New Zealand – has seen club rugby played
internationally. Moreover, it has meant that there exists a constant product for the
respective rugby governing bodies to market, which provides more games to
boost attendances, sponsorship revenues and, significantly, revenue from
broadcast rights. However, as indicated in the headline story, the lifecycle of the
Super Rugby competition appears to be on the wane; and, consequently, a new
strategy is required to position rugby in Australia as a major football code.
Moreover, it was also concluded in the report by Gemba that participation in
Super Rugby was one factor inhibiting elite player development and, ultimately,
the success of the Wallabies.
Given that marketing is primarily concerned with consumer needs, it is the
responsibility of the company to satisfy these needs. RA, for example, must
satisfy multiple demands from:

the players, who need matches and tournaments with attractive financial
rewards
the broadcasters, who need matches and tournaments to provide content with
an ability to attract viewers
the sponsors, who require star players and close, quality contests to ensure
that their financial investment in rugby attracts maximum exposure via the
media, and
the paying public, who want to see rugby played at the optimum level.

Recognising and satisfying consumer needs ensures maximum market share,

market development opportunities and growth. RA’s challenge is to now re-craft a
strategy for the next 10–20 years. It appears the Super 15s has run its course in its
current format, and RA must find a way to enable a return of the Wallabies as one
of the world’s leading rugby teams. A combination of a revamped domestic elite
competition that maximises revenues, leading to a competitive Wallabies team, is
the goal driving RA as it commences a new strategic sport-marketing planning
process.

The strategic sport-marketing planning process

In this book, the strategic marketing planning process is specific in its reference
to sport, and is thus labelled the strategic sport-marketing planning process
(SSMPP). Figure 2.1 illustrates the SSMPP, which includes the eight steps
outlined below.

Figure 2.1 Strategic sport-marketing planning process.

This chapter examines Steps 1–4 of the SSMPP, and Steps 7 and 8 are also briefly
considered. Later chapters deal with individual aspects of the marketing and
service mix variables, detailing the factors to consider in selecting a core
marketing strategy. First, we examine both the external and internal environments
and the forces driving competition.

Step 1: Understanding the environment in which the sport competes

A marketing programme is not delivered in isolation of the organisation-wide
planning process. In normal circumstances, the marketing planning process must
reflect the overall plans for the organisation. In sport, as indicated by the rugby
union example above, there is often little difference between organisation-wide
planning and the marketing planning process. RA’s overall direction and success
are based solely on its major product offerings: Test matches, Super Rugby and
the likely return of an elite domestic competition. Determining the difference
between organisation-wide planning and marketing planning requires careful
attention by sport marketers.
The first step of the SSMPP is equivalent to conducting an inventory. The data
collected form the basis of decisions made later in the process.

External forces
Figure 2.2 shows the environmental factors requiring consideration, which are the
forces that affect an organisation indirectly. They include government legislation,
economic climate, technology, political forces, and demographic and social
trends. It is important for sporting organisations to monitor changes in each of
these forces. Government legislation, for example, can alter the economic
infrastructure of an industry through legislative changes. For instance, when pay
TV was introduced to Australia in the 1990s, government legislation dictated that
pay TV operators would not be able to sell advertising for the first five years.
This was designed to protect the free-to-air networks; and, given the importance
of sports programming to television revenues, this policy reduced pay TV’s
capacity to generate revenue and, in turn, its capacity to pay for rights to
broadcast sport. Technology can also change the ways in which businesses
operate. The internet, via Twitter, smartphones, tablets and apps, has altered the
means through which organisations can communicate and engage with fans,
members, players, coaches and officials. It is also an important source of
information for fans and provides, via streaming, alternative means to broadcast
sport, and therefore to consume sport. The role of technology in the marketing
mix, and specifically the promotions mix, is considered in detail in Chapters 8
and 9.
 Figure 2.2 External environmental forces. Source: Adjusted from Porter
(1985).

At a macro level, political forces might involve government policy directly

affecting an industry. For example, Sport Australia (part of the Australian Sports
Commission) is the agency responsible for implementing government policy in
that country. Similar entities exist in other countries, including the Singapore
Sports Council, the UK Sports Council and Sport New Zealand. A change of
government often leads to new policies. The most obvious and important policy
for many sports relates to funding support. Most national and state sport
organisations are non-profit, with limited sources of revenue. Government
funding is critical for ongoing development. One simple example of government
policy is the focus of funding and programmes on elite or on mass-participatory
initiatives. Demographic and social trends refer to the changing population
makeup of a country. For example, the increasingly multicultural composition of
Australian communities will affect when, why and how sport marketers
communicate with the community. It cannot be assumed that all sport consumers
in a diversified society will respond in the same way to all marketing strategies,
or that everyone will respond to the same sports. For many years, sport
organisations neglected to examine these forces and the impact that a changing
environment might have on their sport. The example of the Cricket Australia
cited in Chapter 1 indicates this past neglect.

Industry competition
On a more direct level, sporting organisations need to monitor the industry in
which they compete. Figure 2.3 incorporates an adapted version of Porter’s
(1980) competitive forces model. Porter described five forces that managers
should review when examining competition and the attractiveness of an industry:

Figure 2.3 Forces driving industry competition.

1. the intensity of competition between existing firms within an industry

2. the bargaining power of buyers
3. the threat of substitute products
4. the bargaining power of suppliers, and
5. the threat of new entrants.

The attractiveness of an industry typically is measured by profitability, which is

not always the main goal of non-profit and sporting organisations. Viability and
winning games are important outcomes and become the primary measures of
attractiveness for sporting organisations. In professional sports leagues, for
example, the number and location of teams in respective markets require the
league to assess the attractiveness of a market in terms of viability. Other
questions indicative of industry attractiveness may include: Is the economic base
of a city or region large enough to sustain just one or more than one team? How
many other professional sports already exist in this market? What other recreation
and leisure pursuits are potentially competing for disposable income? A brief
review of Porter’s five forces follows.
Professional leagues for football will be used to illustrate the applicability of
Porter’s model. The model in this instance assumes that a professional sport
league can be considered an industry, although this industry is subject to the
broader market and competitive pressures of the entertainment and leisure
sectors. The turnover of the Australian Football League (AFL) and its member
clubs, for example, is in excess of A$1 billion, making the AFL a large and
significant economic entity.

Force 1: Intensity of competition

The first force is the intensity of competition within the industry. In the case of a
sporting league, the number of teams and their location are the first indicators of
the intensity of competition. Obviously, nine AFL clubs based in Melbourne and
the same number of professional rugby league clubs based in Sydney intensifies
competition in these markets. This competition is further heightened by the
presence of other sporting codes seeking sponsor dollars, spectators and
members. In both codes, despite the large number of teams in each market, exit
barriers have remained very high. This highlights the peculiar economics
associated with leagues. Tradition, emotion and club loyalties often override the
economic deficiencies experienced by some clubs, explaining why it has not been
so easy to achieve a better geographical balance of teams competing in these
national leagues.

Force 2: Bargaining power of buyers

The second force – the buyers or consumers of sport – is finite in relation to the
number of teams located in one market; hence the intensity of competition by
clubs to attract spectators, members and sponsors. Attendance, membership and
sponsorship revenues are the main sources of income generated by sporting clubs.
Typically, customers can force prices down, demand higher quality and play
competitors off against each other. Too many teams located in one market can
exacerbate the leverage of consumers, although sport consumers in some sport
leagues have less leverage in this regard as club membership tends to be price-
standardised throughout a league and the cost of attendance common to all
games. However with the advent of dynamic ticket pricing there is evidence of
change in relation to general admission spectators, and members are now able to
purchase premium seating at many stadia. Most bargaining power lies with
sponsors seeking to choose the best range of benefits from clubs. Sponsor
bargaining power strengthens as the number of clubs based in a market increases.

Force 3: Threat of substitute products

Another major force comes from the substitutability of products – that is, other
recreation and leisure activities offering similar benefits to those provided by
participation in sport. It is this force that provides the greatest range of
competitive forces for a sport league. Under the broad heading of ‘entertainment’,
a variety of products have the potential to attract the consumer’s money normally
available for leisure pursuits. These may include other sports, the cinema, videos
and the theatre. A major determinant of the strength of these potential substitutes
is the switching cost associated with each product. Switching cost refers to the
cost of changing brands or products. If the cost is low, both financially and
psychologically, then consumers are more likely to switch, and a product
becomes susceptible to substitution. This, of course, has the potential to erode
profits. A major advantage possessed by various sports is that brand loyalty (to
the sport or club) is very high. Psychological association with a sport or club is
often far more important than economic considerations. In part, this explains the
fanatical support for some sports and clubs, such as for soccer clubs worldwide
and for AFL clubs in Australia.

Force 4: Bargaining power of suppliers

Suppliers can exert bargaining power on participants in an industry by raising or
reducing the quality of purchased goods and services. In a sport league, the major
supply required to operate successfully is the players. No one source has
exclusive control over player supply and, with the exception of some sports like
soccer, it no longer costs clubs to buy players. This is also the area that the sport
marketer has least control over in terms of product quality. The bargaining power
of the players has the potential to erode industry profits via their salary demands,
rather than through what it costs to procure players from specific suppliers. In
their quest for the ultimate prize – a premiership or championship – clubs often
accede to the demands of high-priced athletes, explaining why the sport economy
is often regulated by the use of salary caps.

Force 5: Threat of new entrants

New clubs or a new rival league can reduce industry profits and specific market
share for the existing clubs and/or league. The commencement in 1997 (for just
one year) of the Super League competition in rugby league is an example of a
rival league’s entry. Super League, owned by News Ltd, was established to form a
breakaway league, enticing existing clubs and players in the Australian Rugby
League’s (ARL) New South Wales competition to defect. In the process,
contractual obligations of both players and clubs were displaced, ultimately
creating serious divisions within the league. In attempting to overcome the
barriers to entry, the structure and product offerings of the ARL competition were
seriously threatened. The gravity of this threat largely depended on the barriers to
entry. The major barrier in this case was provided by the established and
recognised keeper of the code – the ARL – through the New South Wales Rugby
League competition. A similar scenario arose around 2010 with the introduction
of the Indian Premier League (IPL) in India. This move was followed by the rapid
establishment of leagues in Bangladesh, the West Indies and Pakistan, among
other places. Access to a supply of talented players is usually a major barrier to
entry.

Publics
Examination of the external environment can be concluded by identifying the
publics to which the sport is responsible. To an extent, some of these will have
been identified from the competitive analysis conducted using the Porter (1980)
framework. Kotler and Andreasen (2003, p. 74) define a public as ‘a distinct
group of people, organisations, or both whose actual or potential needs must in
some sense be served’. The competitive forces model has already shown that
diverse publics exist for a club competing in a professional league. Figure 2.4
illustrates the publics that may exist for a professional sport club.
 Figure 2.4 Publics impacting a professional sport club.

Another group of publics exists within the organisation. This leads us to consider
Step 2 in the SSMPP.

Step 2: Understanding the internal capabilities of the organisation

Sport managers gauge the significance of a sport’s internal competencies on the
basis of the opportunities and threats present in the sport’s competitive
environment. For example, the arrival of colour television in Australia in 1974
represented an opportunity for sport, as have the internet and smartphone
technologies more recently. The Australian Cricket Board (ACB; now Cricket
Australia), as previously discussed, did not possess the internal capabilities at the
time to capitalise on this development. However, given this experience, and the
professionalisation of sport, it was much better placed to cope with the new
technologies and social media in the 1990s and 2000s. Similarly, the globalisation
of sporting competitions via the media has opened a window of opportunity for
the professionalisation of Rugby Union.
SWOT analysis
An important foundation for understanding the internal capabilities of a sport is
the ability of the sport manager or marketer to match strengths and weaknesses
with industry opportunities and threats. The international rugby union community
clearly identified the threat of being overrun by the larger and more powerful
professional football codes. The choice of RA to engage in an alliance with New
Zealand and South Africa is evidence of a sport recognising an opportunity to
share the production and professionalisation of rugby union rather than be forced
to expand the code in limited markets in each country. This example, in view of
the headline story, highlights how strengths, weaknesses, opportunities and
threats (SWOT) change over time given changing competitive conditions and fan
sentiment and, as a consequence, need to be revisited regularly. The SWOT
analysis is a commonly accepted tool used by managers to assess the current
capabilities of their organisations. In essence, it provides a structure for their
analysis:

Strengths are resources, skills or other advantages relative to competitors.

Weaknesses are limitations or deficiencies in resources, skills and
capabilities that inhibit a sport’s effectiveness in relation to competitors.
Opportunities are major favourable situations in a sport’s environment.
Threats are major unfavourable situations in a sport’s environment.

Mission, objectives and goals

Having established the internal capabilities, it is necessary to ascertain the
mission of the organisation, followed by a review of the organisation’s principal
goals and objectives. The mission statement (sometime referred to as a purpose
statement in non-profit sport organisations) provides direction for the sport,
defining and clarifying its meaning and reason for existence. To be unambiguous,
a mission statement should clearly answer ‘What is our business?’
For example, the Australian Institute of Sport’s mission statement is
deceptively simple: ‘To build sustainable winning systems for Australian
athletes’. This is similar to the mission of the rebranded World Athletics (2020)
(formerly the International Association of Athletics Federations), which is to
‘Grow, Inspire and Lead’. Likewise, the NRL’s 2018–2022 purpose statement is
‘To bring people together for the best sports and entertainments experience –
Unite, Excite and Inspire’ (NRL, 2018). Given the increasing focus on the sport
experience in sport marketing strategy, the NRL’s purpose acknowledges the
importance of the sport experience, as discussed in Chapter 1.
 In the context of sport, another factor impinges on formulating mission
statements. Most sports are non-profit entities, and as such exist to achieve a
common group of objectives by a relatively homogeneous group of people. Non-
profits by definition exist to fight a cause. This cause becomes the operating
charter, which is generally less flexible than the mission statement of a for-profit
firm. If the cause ceases to exist, so too will the organisation. If profits cease to
exist, the for-profit firm has the choice of redefining the business in which it
wishes to be, and hence its range of product offerings.
Organisational goals refer to the broad aims that organisations strive to
achieve. In sport, these may include ensuring financial viability, increasing
participation, raising the number of members and stimulating public interest in
the sport. Each of these goals contributes to the key targets a sport organisation
seeks to achieve. The NRL in its 2018–2022 strategic plan, for example,
established four pillars against which nine priorities are shown to direct actions
and measure progress (see NRL, 2018 for details). Although the strategic plan
available on the NRL website details these key pillars and priorities it does not
specifically show the measures and targets the NRL will have set. This is often
the case in a public document; but the NRL would have these measures as key
performance indicators against which to monitor progress. When formulating
these strategic initiatives, it is important to consider the necessary detail to
achieve key result areas and seek to establish SMART objectives, which are:

S – Specific
M – Measurable
A – Achievable
R – Realistic
T – Timebound.

Step 3: Examining market research and utilising information

systems
Step 3 recognises that the important phase of market research is undertaken to
ensure that decisions made in relation to marketing missions and objectives are
based on a sound understanding of the marketplace. Basically, market research in
sporting organisations seeks to answer six questions about consumers in relation
to their consumption of the product. Initially, sporting organisations need to know
WHO their consumers are; but this is only the tip of the iceberg. WHY they
choose the particular sport product, and WHEN and WHERE that consumption
takes place, are equally important. WHAT that consumption entails in terms of
pre- and post-event activities, and HOW the product is used, also are critical in
terms of establishing a complete consumer profile.
To make informed decisions, organisations need information – and lots of it.
Yet the collection of this material is only a starting point for the construction of a
management or relationship information system. Once compiled, this information
must be integrated, analysed and used to guide the direction of the organisation.
For such a system to be successful the data should not only be of high quality; it
must also be used in a realistic manner and adopted as a source of decision-
making by the organisation. Information collated through market research and
organised into meaningful data sets provides the foundation for sport marketers to
determine marketing strategies. In other words, this information helps sport
marketers to refine and develop their sports, to know where and when to offer
them, and to what age groups and at what times. These are just a few examples of
how this information underpins marketing strategy decisions.

Step 4: Determining the marketing mission and objectives

Marketing must devise its own specific plans, complementary to the
organisation’s overall mission, goals and objectives. The purpose of the planning
process is to establish a competitive advantage over rival firms. The mission of
marketing is to develop a range of product offerings that reflects a firm’s
organisation-wide mission statement. These products may be in the form of goods
and/or services, depending on the nature of the business. In sport, the product
offerings tend to be limited, although they are clearly in the service domain and,
significantly, experiences valued by sport participants and fans. Inherent in the
challenge confronting the sport marketer is designing this portfolio of product
offerings to achieve a competitive advantage.

Competitive advantage
Porter (1985) describes competitive advantage as ‘the way a firm can choose and
implement a generic strategy to achieve and sustain a competitive advantage’ (p.
26). This definition is specific to three generic strategies that he describes, which
will be discussed later in this chapter. The concept of competitive advantage,
however, is broader than Porter’s direct application to his theories. Implicit in this
concept is the notion of sustainability. Without sustainability, a competitive
advantage becomes elusive. Coyne (1986) posits three conditions that must be
met for a firm to have achieved a sustainable competitive advantage:
 Customers perceive a consistent difference in important attributes between
the producer’s products or services and those of competitors.
That difference is the direct consequence of a capability gap between the
producer and competitors.
Both the difference in important attributes and the capability gap can be
expected to endure over time.

The key to sustainability is differentiation among competitor products. Coyne

(1986, p. 55) further notes that:

for a producer to enjoy a competitive advantage in a product/market

segment, the difference or differences between him and his competitors must
be felt in the marketplace: that is, they must be reflected in some
product/delivery attribute that is the key buying criterion for the market.

Each individual sport has its own unique set of product attributes, due to its
particular nature. In this regard, some sports are inherently more appealing to
some segments of the population. For many years, sports believed that these
unique features of their game would remain popular forever. In Australian sport,
however, this was proven not to be the case. The traditional sports of cricket,
Australian Rules football, netball and softball suddenly found that their
competitive advantage was being eroded by changing attitudes towards leisure
options. Increasing diversity of recreational and sporting opportunities saw these
sports struggling in the late 1970s and early 1980s, and as a consequence they had
to re-examine their key buying criteria and look to reposition themselves. One
technique that these sports could have used to examine their range of product
offerings is covered in the next section.

Product market expansion

Ansoff (1957) devised the product/market expansion grid, shown in Figure 2.5, to
help managers balance their product offerings.

Figure 2.5 Product market expansion grid. Source: Adjusted from

Ansoff (1957).
Market penetration
Market penetration (or concentration) refers to making more sales to existing
customers without changing the product. Typically, this involves intensifying the
advertising and promotions campaign to attract consumer attention. Often this
strategy also involves a price reduction aimed at moving consumers away from
competitors’ products. The former New South Wales Rugby League (NSWRL)
advertising and promotional campaign ‘Simply the Best’, featuring Tina Turner,
is an example of a market-penetration strategy in sport. Although there were
some minor adjustments to the game in terms of a crackdown on excessive on-
field violence during the 1980s, the game itself remained unchanged. The
NSWRL was successful in stimulating interest in the game, which translated into
flourishing attendances and television viewership. The ‘Simply the Best’
advertising campaign is considered to be one of the most sophisticated, inspiring
and modern promotional campaigns seen in Australian sport, and can be accessed
on YouTube (www.youtube.com/watch?v=Z-P0085ii4Q).

Market development
A market development strategy is a relatively inexpensive way of creating new
markets for existing products. It typically involves few risks and requires only
minor modification to the product. It depends on sound research indicating that
new segments of the population are willing to buy the product. The end-of-
chapter case study describes how Football Federation Australia (FFA) is
responding to a changing environment for the broadcast of the A-League
competition. A series of 11 principles have been developed around which various
aspects of the A-League will change, including the timing of the season, as well
as other broader initiatives planned for the sport. Inevitably, these changes will
require an adjustment to the marketing mix variables.

Product development
A product development strategy involves offering a modified or new product to
current markets. Australian cricket’s introduction of one-day games is an example
of a sport exhibiting aspects of both market development and product
development. One-day cricket can be considered to be the same product as four-
and five-day cricket. Notably, the condensed version of the game has attracted a
large following among women, which Test match cricket did not. On the other
hand, one-day cricket can be considered to be a modified form of the game, and
may thus better be described as a product development strategy by Cricket
Australia. The weakness in this view is that one-day cricket has obviously had the
capacity to expand the market interest in cricket. The traditional form of the game
was not creating this expansion, although in recent times an exciting brand of
cricket has been a feature of Test matches – as was evident in the 2019 England
vs Australia Ashes series, which consistently produced intense periods of tough
cricket truncated by dramatic finishes. Rule changes that allow for extended hours
to make up for time lost due to rain, and the need to bowl a minimum number of
overs in a day’s play, have contributed to an increase in Test match results.
Combined with an aggressive and relentless approach by the Australian cricket
team during the Waugh, Ponting, Warne, Hayden, Gilchrist, McGrath era, Test
match cricket experienced a resurgence in interest. It also illustrates the impact
sport managers can have on the product through rule changes, such as those
shown in cricket.
Regardless of the final distinction and product form responsible for growing
cricket, it raises an interesting dilemma in sport marketing: namely, the point at
which the game has been modified to such an extent that it is in effect a new
product offering. In one-day cricket, for example, the basic elements of the game
are still apparent: batting, bowling and fielding. The condensed version of the
game forces more action; but whether this constitutes a new or different product
is debatable, and illustrates the conflict that can exist between the ‘purists’ and
those who prefer non-stop excitement in sport. With the introduction of Twenty20
cricket, the same questions can be posed. Does Twenty20 cricket differ so much
from the traditional form of the game that it could be considered a new product?
Another example of sports having to modify their range of product offerings
has been seen in junior sports. For many years juniors played the adult form of
the game, complete with all the rules and traditions associated with that particular
sport. As research began to show that this was not providing a satisfactory sport
environment for juniors, many sports were modified to make them more attractive
to juniors. In essence, sports have been modified to encourage more success in
game elements, increasing the likelihood of juniors continuing to participate.
Although sports initially did not see this as a marketing-related issue, this has
now changed. The long-term fortunes of a sport, from both an elite performance
and an ongoing interest and spectatorship perspective, are founded on the success
of its junior programmes. Market development and product development
strategies have therefore assumed heightened levels of importance, with sports
carefully considering their range of sport offerings for juniors in various age
groups.

Product diversification
The final category of product diversification requires a firm to develop an entirely
new product for a new market. This can be achieved internally, through a strong
research and development function, or via the external acquisition of a new firm
with a new range of product offerings. In terms of the core sport product, this
strategy is not common in Australian sport, although there are examples of
professional clubs purchasing assets such as hotels and social clubs and creating
leisure businesses with a view to diversifying income opportunities. Sporting
organisations in the main do not seek to buy other sporting organisations,
although it remains an option. If, say, a powerful and rich soccer club in the
English Premier League (EPL) or a European league were to buy a share of
ownership in another soccer club in the Chinese Super League or another
country-based pro soccer league, this would be an example of product
diversification – in this case acquiring a related product (in terms of sport) but in
a new market. The marketing objectives could include increased brand
recognition for the English and European clubs by building an additional fan base
in China, as well as economic benefits through merchandising and a larger
television market. The product/market expansion grid (Figure 2.5) provides a
framework for the sport marketer to consider the balance of product offerings.
This balance of product offerings should reflect the marketing mission, which in
turn should mirror the overall mission, goals and objectives of the organisation.

Generic strategies
As indicated earlier, Porter (1985) describes three generic strategies that firms can
use as an alternative framework to achieve competitive advantage:

cost leadership
differentiation, and
focus.

Both the cost leadership and differentiation strategies aim to seek a competitive
advantage in a broad range of markets. The focus strategy aims to seek a
competitive advantage by using either a cost leadership or a differentiation
strategy in a narrow or niche market segment. Cost leadership is perhaps the
simplest of the three options. The organisation’s principal objective is to
distribute its products to the widest possible market at a lower cost than that of its
competitors. Achieving lower cost may be the result of internal economies of
scale, innovative technologies or lower distribution costs. In the end, it is the
consumer who decides whether the cost differential is significant enough to
warrant the purchase of a product over those of competitors.
Differentiation is typically more expensive. It involves an advantage based on
distinctive product attributes. Products may, for instance, offer benefits that others
do not, or they might be new and innovative products that are not currently
available. Again, differentiation is seeking to establish its product prominence in
as wide a market as possible. In sport, cost leadership strategies are difficult to
achieve. In a sporting league, the clubs generally compete on equal terms in terms
of cost. Standardised prices for attendance and membership reduce the
significance of cost as a source of competitive advantage; although increasingly –
in the AFL, for instance – there is movement away from strict standardisation of
ticket cost with the introduction of dynamic ticket pricing. This has largely been
driven by improving facilities and a move to fully seated stadia, which have
provided clubs with the opportunity to increase ticket sales revenues by selling
the best seats at premium rates. The capacity to extract premium prices provides
important extra revenue for the clubs. As will be examined in Chapter 6, clubs
and leagues cannot always achieve full cost recovery on ticket prices. If full cost
recovery (in terms of covering event costs) were an objective, most sports would
become too expensive for regular attendance.
A differentiation strategy provides scope for application in the sport setting.
Although all the clubs in a league appear to be the same in terms of production,
they offer distinct brand images. These are, of course, the clubs themselves – with
their distinctive colours, heritage and traditions with which supporters identify
with a good degree of emotional intensity. On a macro level, each sport is a
differentiated product in its own right, with each offering similar benefits to
consumers. The choice for consumers, in terms of physical activity, competing or
spectating, comes down to which of the myriad sports available offers the best
outlet to satisfy their needs and wants. This is equally applicable for juniors when
they (or their parents) are choosing the sports in which they wish to participate.
Some sports – such as cricket, golf, softball, swimming and netball – offer the
challenge of special skill development without any excessive body contact.
Football codes, basketball and wrestling offer a different range of skills, to be
mastered in the context of body contact. The challenge for the sport marketer is to
accentuate the differentiated product benefits to potential participants, and this
sometimes means changing the fundamental rules and traditions of a sport.
Although this is obviously an option, sport managers and marketers need to
consider the impact of proposed changes carefully before implementation.

Steps 5–8: Strategy determination, implementation and control

Following the identification of marketing opportunities (Chapters 1 to 4), Steps 5
and 6 in the SSMPP are the major focus of Chapters 5 to 11 in this book. This
serves to highlight how important the 7Ps of marketing are when it comes to
formulating sport marketing strategy and tactics.
 Having completed Steps 5 and 6, it then behoves the sport marketing manager
to consider how to monitor and measure the success of the strategy. Armstrong et
al. (2018) note that marketing control involves ‘evaluating the results of
marketing strategies and plans and taking corrective action to ensure that
objectives are attained’ (p. 55). Setting standards is part of the marketing planning
process discussed in this chapter. Marketing objectives established during this
process will have identified the standards to be achieved, both on an annual basis
(operational control) and over the life of the plan (strategic control). Annual
review of objectives is important and forms part of a 12-month operational
planning cycle which accumulates over the life of the plan. In other words, annual
reviews allow managers the option to take corrective action if targets are not
being achieved. In sporting organisations, these objectives and standards differ
from those of organisations solely concerned with profit and providing dividends
to shareholders.
Sport is unique in this regard as there are often broader goals than simply
maximising profits, such as contributing to changing societal attitudes to various
social issues through sport. Moreover, on-field success can often be seen as more
important than bottom-line profits, which can present financial challenges if left
unchecked. Other measures relevant to sport include memberships, attendances,
fan engagement, fan experience, participation, sponsorship revenues, television
and media revenues, ratings, share, merchandise, licensing and, of course,
financial measures. Recognition of these broader considerations does not in any
way lessen the importance of marketing to sport. In fact, the reality is quite the
opposite as sport – like most non-profit entities – often does not have access to
financial resources to the same extent as for-profit entities. Sporting organisations
rely on the ability of marketing programmes to raise the revenue required to run
the club, association or league. Several consistent themes will emerge in this book
that allude to the main measures of success in sporting organisations. Most of
them are directly aligned with elements of the marketing mix. Establishing and
benchmarking performance standards represent the first step towards controlling
the marketing programme.
Implementation and control are therefore related and important components of
sport marketing strategy. There are three types of organisational control. First,
feed-forward control takes place before production and operations begin. Second,
concurrent control occurs during the sporting fixture – in other words, while the
plans are being carried out. Finally, feedback control focuses on the final
performance measured against previously established standards or targets. As
such, the marketing plan can evolve with continual review and modification
where necessary. Control is discussed further in Chapter 12.
Summary
This chapter introduced the strategic sport-marketing planning process (SSMPP)
and reviewed the first four steps and the final two steps in this process. The first
four steps constitute the data-collection and review phase of the planning process.
Organisation-wide data are required to place into context the role that marketing
strategy plays in ensuring that a sport creates a sustainable competitive advantage.
In the first instance, a sporting organisation needs to review the external
environmental factors impinging on its existence. These factors are best described
as the set of societal influences that encroach on all organisations, which include
government legislation, economic environment, technology, political forces, and
social and demographic trends. A more direct form of analysis involves a review
of industry characteristics specific to a sport. Porter’s five-forces model provides
sport managers with a structured framework to scan the competitive environment,
and is the precursor to a review of the internal capabilities of a sporting
organisation. SWOT analysis was described in this chapter as a useful tool to
assist with this internal examination.
Review of the external and internal environments is an important precursor to
determining the best strategies to create a competitive advantage. In essence,
marketing personnel are responsible for developing an array of product offerings
that help an organisation achieve a competitive advantage. In predominantly
single-product organisations such as those in sport, marketing’s contribution to
creating a competitive advantage is considerable. The final two steps in the
SSMPP close the loop for marketing personnel when monitoring the success of
the marketing strategy. Corrective action may be taken as needed if good controls
are in place together with clear targets.
In many ways, sport and marketing are now more comfortable with each other.
For many years, most sports administrators did not believe that the role of
marketing was important. However, as the sport landscape became increasingly
competitive, sport managers began to adjust their thinking. Most large sporting
entities have now created marketing departments, and many smaller sporting
organisations are beginning to employ marketing specialists to manage the
contribution of marketing in the planning process. As indicated in Chapter 1,
sport organisations have been guilty of complacency in the past in relation to
marketing and promoting their sport. This is clearly changing, as exemplified by
the case study concluding this chapter.

CASE STUDY
The starting XI: Football Australia’s 15-year plan
On 26 June 2020 in Australia and New Zealand news broke late at night that the
countries had jointly been awarded the 2023 FIFA Women’s World Cup (FFA,
2020a). The Trans-Tasman bid fended off Colombia as the main competitor,
winning the vote 22 to Colombia’s 13, and brought tears of joy to current and
past players, senior executives and officials of Football Federation Australia
(FFA) and New Zealand Football. The winning bid confirmed the technical
scores assessed as part of the bid, which ranked the Australia/New Zealand bid
as technically superior.
Off the back of this announcement, FFA has moved to maintain the
momentum by releasing its vision for Australia Football – a discussion paper
that sets a direction for the next 15 years. The discussion paper, entitled XI
Principles for the Future of Australian Football, was compiled over many
months as FFA worked its way through the COVID-19 pandemic. It is a ‘living
document’ which will continue to be shaped by FFA as it uses it as a basis for
engagement and consultation with the Australian football community (FFA,
2020b). In other words, in what is typically regarded as a highly charged
melting pot of about 2 million participants represented by over 200 cultures,
FFA seeks to encourage discussion to help determine direction but, equally, to
allow some flexibility to shape the plan in response to what will be a robust
debate.
It also recognises the potential changing broadcast environment for the A-
League in which current broadcaster Fox Sports only committed to broadcasting
the league until the end of 2021, during which an initial change to season dates
(July–December) were to take effect. The ultimate plan is to move the A-
League back to a winter competition in which it will compete head on with the
AFL and the NRL. According to the press release (FFA, 2020a):

FFA Chief Executive Officer, James Johnson, said he believes that the time
is right to release the document to enable Australia’s broad football
community to share their thoughts and make an important contribution to
the future of Australian football.
‘Throughout the course of 2020 FFA has received extensive feedback in
relation to areas of possible transformation from stakeholders, partners and
participants across the Australian football ecosystem.’

On 6 July 2020 FFA sought further comment by releasing a series of online

surveys to allow the football community the opportunity to comment on the
proposed plans. The refreshed purpose and vision of FFA underpin the XI
principles of the plan.
Purpose: Bringing communities together through football; connecting
Australia to the world.
Vision: A leading Football nation where everyone is inspired to live and love
the game (FFA, 2020b, p. 11).

XI principles
1. Build a consistent and strong identity for Australian football which inspires
all Australians.
2. Develop a new narrative for football which signifies a fresh start for the
game in Australia, successfully ties together all new initiatives and
distinguishes it from other sporting codes in the country.
3. Establish an integrated and thriving football ecosystem driven by a modern
domestic transfer system.
4. Create a dynamic and engaging football product by optimising competition
structures to connect Australian football; promote competitive balance and
tension; promote uncertainty of outcome; incentivise sporting
achievement; and prioritise the fan experience.
5. Create a world class environment for youth development/production by
increasing match minutes for youth players and streamlining the player
pathway.
6. Create a strong culture around coach development by emphasising the
importance of the role as a skilled position and a vital link in player
development.
7. Transition towards a modern, fit-for-purpose governance framework for
football in Australia in line with global standards and best-practice sports
governance in Australia.
8. Create an operating and governance model for the A-League, W-League
and Y-League which is fit for the current circumstances.
9. Ensure that football becomes more open and accessible to the Australian
community and that cost does not remain a barrier to participation.
10. Continue the growth of the game by driving participation of women and
girls and enhancing existing competition structures to promote player
development.
11. Position the Westfield Matildas and the Socceroos as the unifying symbols
of the game and heroes who epitomise the Australian football identity to
 inspire every young Australian regardless of their ability or background
(FFA, 2020b, p. 12).

The optimism gained from the successful Women’s World Cup bid provides the
right time to strike:

FFA believe that the next step for Australian football is to develop a united
‘Vision’ for the game to work towards. We dared to dream when we
submitted our joint bid to host the 2023 FIFA Women’s World Cup and
look where dreaming got us. So, let us dream once again and imagine a
future for Australian football – what will Australian football look like in 15
years’ time? (FFA, 2020, p. 8)

Questions
1. Comment on the extent to which the purpose statement is realistic. Would
you change the purpose statement? If so how?
2. Examine the XI principles and identify how many of them have a direct
impact on a sport-marketing strategy for FFA.
3. If you were asked to provide feedback to FFA via the online surveys, what
would the thrust of that feedback be? Would you add any principles?
4. What impact will staging the Women’s World Cup have on the football
product in Australia?
5. Comment on FFA’s approach to engaging the football community with the
shaping of the plan. Is this a realistic option to improve the plan? Why
would FFA take this approach?
6. Describe how a move of the A-League season back to the winter will
change the competitive environment. How will this impact sport-marketing
strategy?
7. What would your dream be for football in Australia or your country of
origin?

References
Ansoff, H.I. (1957). Strategies for diversification. Harvard Business Review,
35(5), 113–124.
Armstrong, G., Adam, S. Denize, S., Volkov, M., & Kotler, P. (2018).
Principles of marketing (7th edn). Pearson, Melbourne.
Coyne, K.P. (1986). Sustainable competitive advantage: What it is, what it
isn’t. Business Horizons, 29(1), 54–61.
FFA. (2020a). FFA release ‘XI Principles’ discussion paper targeting future
of football. Football Australia. https://www.ffa.com.au/news/ffa-release-xi-
principles-discussion-paper-targeting-future-football.
FFA. (2020b). XI Principles for the Future of Australian Football.
https://www.footballaustralia.com.au/sites/ffa/files/2020-07/FFA%20-
%20XI%20Principles_1.pdf.
Kotler, P., & Andreasen, A.R. (2003). Strategic marketing for nonprofit
organisations (6th edn). Prentice Hall, Upper Saddle River, NJ.
NRL. (2018). Unite, excite, inspire: Strategic plan 2018–2022.
https://www.nrl.com/siteassets/operations/documentation/nrl-strategic-plan-
2018-2022.pdf.
NZ Herald. (2020, May 9). Rugby Australia advised to ditch focus on Super
Rugby following revelation of ‘devastating’ figures.
www.nzherald.co.nz/rugby/news/article.cfm?c_id=80&objectid=12330743.
Porter, M. (1980). Competitive strategy. The Free Press, New York.
Porter, M. (1985). Competitive advantage: Creating and sustaining superior
performance. The Free Press, New York.
Robinson, G. (2020). Forget the Kiwis, Australian rugby’s future is local.
Sydney Morning Herald. https://www.smh.com.au/sport/rugby-union/forget-
the-kiwis-australian-rugby-s-future-is-local-20200508-p54r97.html.
World Athletics. (2020, June 30). World Athletics publishes strategic plan.
https://www.worldathletics.org/news/iaaf-news/strategic-plan-for-growth.v
CHAPTER 3

Understanding sport consumers

DOI: 10.4324/9781003270522-5

Chapter objectives
Chapter 3 is the first of two chapters related to understanding the sport
consumer. The chapter provides a foundation for the concept of sport experience
design and a summary of the factors that influence buying and using sport
products in different sport settings. Key frameworks are outlined, including a
focus on how sport consumer decision-making occurs and the role of
involvement in the sport marketing setting. The chapter concludes with a
discussion of a critical and much-used framework to explain how a
psychological connection to a sport product develops and changes.
After studying this chapter you should be able to:

identify elements of sport experience design

identify internal and external factors that influence sport consumption
describe the stages of the consumer decision-making process
understand how involvement level influences decision-making
describe how a psychological connection toward a sport product develops.

Headline story
Understanding consumer behaviour
According to recent reports prior to the COVID-19 pandemic, almost half of the
Australian population over the age of 18 attended at least one sporting event in
2019–2020. Table 3.1 provides results of an industry study and shows the
percentages from a nationally representative sample of 878 people who reported
attending different sports events live, and consuming them via media channels.
Australian Rules football remained the most popular spectator sport, with 33 per
cent of people attending live and 61 per cent watching via media channels.
Cricket, rugby league and tennis are the net most popular. Table 3.1 illustrates
variance in consumption with regard to attendance and media patterns. Some
sports – for example, basketball and rugby union – have strong levels of media
consumption but do not covert this interest to live attendance as well as other
sports.
TABLE 3.1 Australian sport consumption (2020)
Attended Live Watched on TV or Streaming
Sport
(last 12 months) Service (last 12 months)
Australian Rules
33% 61%
Football (AFL/AFLW)
Cricket (BBL / WBBL) 18% 56%
Rugby League (NRL) 17% 53%
 Attended Live Watched on TV or Streaming
Sport
(last 12 months) Service (last 12 months)
Tennis 13% 57%
Soccer (A-League / W-
13% 41%
League)
Horse Racing 12% 29%
Motor Racing 9% 40%
Basketball (NBL /
7% 32%
WNBL)
Rugby Union (Super
6% 39%
Rugby)
Netball 5% 28%
eSports 4% 19%
Source: Karg (2020).

As Table 3.1 shows, sport attendance and diversity of choice are very important
to a large percentage of the Australian public. Today, Australians can choose to
invest their leisure time in following any number of sports teams or events, as
well as several competing leisure interests. Hence it is becoming increasingly
important to ascertain why consumers turn up to sporting events, week in and
week out. Is it for team loyalty, stadium preference and amenities, geographical
proximity, clashes between traditional rivals, star players, boredom or spending
time with friends and family? More importantly, why does attendance at
sporting events seem to be decreasing? There has been an increasing amount of
research on sport consumers, with sport marketers now better prepared than at
any stage in the past to make informed decisions based on their understanding
of the consumer. Increasingly, sport marketers understand what distinctive
reasons influence individuals’ choice of attending one type of sporting event
over another. These reasons may be personal, psychological, social and/or
situational. Furthermore, they may be largely experiential. Hence, choosing to
purchase a ticket and attend a sporting event can be simple for some consumers
and a more complex decision for others. It should never be questioned that the
better we know and understand our consumers, the more prepared we will be to
deliver a satisfactory product, and ultimately the whole sport experience.
Sport consumer behaviour
Sport consumer behaviour represents buying and using sport products that can be
easily observed, but the cognitive aspects that influence such behaviour are
hidden. The term ‘sport product’ is used throughout this chapter to represent a
product, good, service or experience that spectators and recreational participants
consume within the sport marketplace. Sport organisations use information
collected from consumers to develop and position their products to satisfy needs
and provide benefits. As a result, sport organisations can develop marketing
tactics to increase and sustain consumer demand. In addition, management
decisions that involve constructing and delivering quality sport products can be
improved through understanding the concept of experience design.
The sport experience design reflects how sport organisations develop products
that consumers want to purchase and use. Holistically, there are two entities
trying to achieve a purpose. The sport organisation wants to develop and sell a
product, and the consumer wants to purchase and use a product. This concept is
described by the Sport Experience Design (SX) framework (Funk, 2017), which
proposes three different but related elements: the sport user, the sport organisation
and the sport context. The sport organisation is the business that develops,
markets and delivers a product to secure resources in order to be successful – for
example, decisions made by a professional football franchise to produce a live
home match and manage customer interactions. The sport user is the consumer
who has a variety of needs, desires and expectations. For example, the reasons
consumers seek out and use sport products can differ based on demographic,
psychographic, geographic and/or behavioural characteristics. The sport context
represents the physical and virtual environment through which the consumer
navigates to buy and use the sport product. Contexts could include attending a
live sporting event at a venue, watching a game at home, using a website or app
to purchase tickets or merchandise, streaming a match on a mobile device or
using social media to follow a team. As a result, the sport context represents the
moment when supply meets demand.
Holistically, the SX framework accounts for how various design-relevant
factors influence user–organisation–context interactions that shape sport product
experiences. From a design perspective, these interactions include a sequence of
operational choices made by the sport organisation related to where, how, what
and when customers are exposed to stimuli when buying and using a sport
product. The ultimate design goal is to create a sport experience that enhances
use, pleasure and customer satisfaction. However, the sport experience can
consist of multiple interactions between the sport organisation and the consumer
across numerous contexts and time periods that produce cognitive and physical
responses. These responses are explained in the following definition of sport
consumer behaviour.
Sport consumer behaviour is defined as the cognitive and physical responses
that occur before, during and after buying and using a sport product (Funk et al.,
2016). Cognitive responses can include perceptions, attitudes and emotions that
consumers have when buying and using a sport product. Physical responses can
include tasks and movement required to buy and use a sport product as well as
physiological arousal of the senses (sight, sound, smell, taste, touch) that occur.
This definition views sport consumer behaviour as a holistic process that
describes how consumers devote available resources of time and money toward
sport consumption activities. As a result, sport consumer behaviour reflects how
cognitive and physical responses are influenced by internal and external factors.
These factors are discussed in the next section.

Factors influencing sport consumption

Sport consumption is influenced by personal, psychological, social and situational
factors. These factors influence both organisations and consumers that make up
buyers and sellers of products within the sport marketplace. The four factors are
illustrated in the top part of Figure 3.1. Although these factors are depicted as
independent, they should be considered as interrelated because they can
individually and jointly influence consumer buying and using behaviour, shown
in the middle of portion of Figure 3.1. Personal and psychological factors are
considered internal forces since these are person-specific characteristics linked to
the consumer. Social and situational factors are considered external forces since
these are broader socio-cultural and environmental aspects linked to a consumer
functioning within society and specific contexts where consumption takes place.
External factors are particularly influential on consumption within the sport and
recreation industries, as observed during the COVID-19 pandemic and racial
equality protests that occurred in 2020. The following sections provide an
overview of each factor in Figure 3.1.
 Figure 3.1 Model of sport consumer behaviour.

Personal factors
Personal factors represent person-specific characteristics that influence consumer
buying and using behaviour. These characteristics can be gender, race, education,
income, geographic location, lifestyle, life-stage, personality, body type, prior
experience, knowledge and ability to perform behavioural tasks. For example, a
consumer’s geographical location is important as differences in sport participation
between a beach and mountain community would be expected, based on climatic
differences. An individual living on the Gold Coast in the state of Queensland is
more likely surf and paddle board compared to an individual living in the country
town of Jindabyne in the state of New South Wales who is more likely to ski.
Spectator sport consumption can also differ based on location and influence
preference for certain sports over others, such as the AFL being the dominant
sport in Victoria while the NRL is the dominant sport in Queensland (Doyle et al.,
2013). Another example is an individual weighing 65 kilograms and standing 170
centimetres may find contact or strength sports less enjoyable than sports such as
running and cycling in which her or his body size helps with performance.
Individuals will also seek out and engage in sport activities such as climbing,
snowboarding, ultimate Frisbee and triathlons that have characteristics like
human personality traits in order to express their own unique identity (Alexandris
et al., 2016). This helps explains why certain individuals prefer cricket over
rugby, bushwalking over running or BMX over road cycling.
Psychological factors
Psychological factors are mental aspects that influence consumer buying and
using behaviour. These mental aspects represent individual-level cognitive
processes such as motivation, learning, perceptions, attitudes and self-concept. In
general, reasons to buy and use a sport product reflect consumers trying to satisfy
needs and wants. For example, an individual may register for, train for and
complete a 10k road race to satisfy a desire for accomplishment, competition and
socialisation. Sport consumer research has identified a variety of motivational
factors that influence sport consumption, with five commonly found among
spectators and participants across various contexts (Funk et al., 2009). These are
labelled with the acronym SPEED, and are referred to as core consumer motives.
They are listed below, together with an explanation for each motive.

Social interaction: This represents a desire for sociability, as individuals are

motivated to seek out a sport product due to opportunities for the
enhancement of human relationships through interaction with other
spectators, participants, friends and family.
Performance: This represents a desire for aesthetic and physical pleasure,
as individuals are motivated to seek out a sport product due to opportunities
to enjoy physiological movement and the grace, skill and artistry of athletic
endeavours.
Excitement: This represents a desire for intellectual stimulation, as
individuals are motivated to seek out a sport product due to opportunities for
mental engagement and exploration from the atmospheric conditions created
by the uncertainty of participation and competition, and the spectacle of
associated activities.
Esteem: This represents a desire for competency, as individuals are
motivated to seek out a sport product due to opportunities for achievement
and challenge that produce a sense of mastery and heighten a sense of
personal and collective self-esteem.
Diversion: This represents a desire for mental well-being, as individuals are
motivated to seek out a sport product due to opportunities to escape and
remove themselves from daily work and life routines, which create stress.

Social factors
Social factors reflect the socio-cultural environment in which an individual lives
that influence consumer buying and using behaviour. These factors can include
customs, culture, media, institutions, religion, politics and important reference
groups. Family and friends are particularly influential reference groups. For
example, if one family member plays golf, netball, soccer or volleyball, there is a
high probability that children or siblings of the same gender (in gender-specific
sports) will engage in that activity. Peers are also important as choices of
companions often stimulate a consumer to develop similar interests and
behaviours. If a particular group of friends is heavily involved in playing and
watching basketball, pressure to conform to the group is likely. Recent
immigrants to Australia will also most likely follow or play a sport such as soccer
or one that is popular in their country of origin before sampling more indigenous
offerings such as Australian Rules football (Lee & Funk, 2011). Other significant
social factors may include sport clubs with which an individual is affiliated, or
schools and universities attended. Economic considerations also exist as
individual wealth will enable the purchase of equipment to undertake a particular
sport or activity, such as joining a fitness club or a local golf club.
Mass media, the internet and social media are also important social factors that
influence sport consumption. Technology continues to play a key role in
providing individuals with sport-related content and information, with social
media platforms being adopted widely. New media technologies have altered
traditional sport consumption activities by reducing geographic and temporal
boundaries, as an individual can follow a team, player, league or event from any
place in the connected world at any time (Kennedy et al., 2021). In addition, the
volume, speed and type of content delivered through the vast array of platforms –
including websites, Facebook, Twitter, Instagram, TikTok, YouTube, podcasts and
blogs – allow individuals to interact with and engage in various forms of sport
consumption. Political, religious, cultural and service groups are also influential
factors. Often, these groups use sport to place their organisation in a positive
light, or to piggyback on the popularity of a particular sport or activity.

Situational factors
Situational factors represent the human and technological made environments that
influence buying and using behaviour. These factors can include physical and
virtual surroundings, social and temporal conditions, buying and using tasks, the
product’s design, technology and a sport organisation’s marketing activities. Sport
consumer researchers suggest that situational factors attract consumers to specific
consumption contexts requiring them to navigate various interactions to select
and use sport products (Funk & James, 2004). A panel of sport marketing
scholars identified recent advancements in technologies that will influence
consumer behaviour over the next decade, including virtual and augmented
reality, streaming platforms, social media use, connected stadiums, digital
marketing tactics, the rise of esports, use of multiple screens, audience
fragmentation and new data available to influence sport training and performance
through wearable devices (Funk, 2017). Such advancements have accelerated
recently due to COVID-19 changing the sport marketplace, and particularly sport
consumption. As a result, specific technologies have been changing, and will
continue to change, traditional consumption practices and patterns of sport and
recreation consumers.
There are also several situational constraints that create ‘obstacles’ or
‘barriers’ that can prevent or alter sport consumption. Pritchard et al. (2009)
report that spectators are less likely to attend games due to: the financial cost of
tickets and concessions; schedule conflicts due to work and social obligations;
limited access to tickets and good seats; travel, such as parking and transportation
to the stadium; and weather. For recreational pursuits, constraints that prevent or
alter consumption can be lack of time, accessibility to facilities and open spaces,
financial expense, lack of friends and partners to participate with, health and
safety, and lack of confidence (Alexandris et al., 2008).
In summary, sport consumer behaviour can be influenced by a diverse number
of personal, psychological, social and situational factors. As previously
mentioned, these factors should be considered as interrelated because they can
individually and jointly influence consumer buying and using behaviour shown in
the middle portion of Figure 3.1. Sportview 3.1 provides an example of the
factors for a new professional sporting team that may lead to an individual
supporting that new team.

Sportview 3.1
New sporting teams
Several new sporting teams have been introduced to the Australian sport
marketplace. Previously, all of the country’s ‘Big 4’ football codes (NRL, AFL,
A-League, Super 15) have welcomed new franchises into their competitions,
with many other sporting competitions also opting to expand. New teams are
introduced to existing leagues or created for the purposes of establishing a new
league. For example, the AFL introduced teams into the previously
unrepresented and non-traditional regions of the Gold Coast and Western
Sydney in 2011 and 2012 respectively. Elsewhere, eight new teams were created
to form Twenty20 cricket’s Big Bash League. Consequently, new sporting team
introduction is generally born from a strategic effort by leagues to increase their
market share and push into non-traditional and new regions. However, these
goals are hard to achieve, and in many cases new teams have not been able to
remain viable and have folded (e.g., A-League’s North Queensland Fury and
Gold Coast United). Given that Australians already have a wide array of
sporting teams and other leisure pursuits to follow, new teams face unique
challenges in building sustainable fan bases. Therefore, it is important that new
teams and existing leagues understand the importance of internal and external
factors discussed in this chapter.
Internal factors may be satisfied easily by new teams as they provide people
residing in their communities with a new form of entertainment, an additional
outlet for diversion and an important catalyst for social interactions. New teams
represent novelty, given their lack of history, and provide individuals with a
chance to experience top-level sport in their local community. Additionally, new
teams provide an added outlet for an individual to escape the daily pressures of
their life and an attractive avenue in which to invest leisure time. Perhaps most
importantly, new teams facilitate increased opportunities to develop existing
interpersonal relationships and meet new people with similar interests.
External factors, such as the tendency for certain cultural groups to prefer a
particular sport, may also be satisfied by new sport team introduction. Regions
such as Western Sydney are home to an ever-increasing number of individuals
from many differing cultural backgrounds. Existing sport offerings available to
these individuals, such as rugby league and the AFL, are scarcely available
outside of Australia, and may appear confusing or overly physical to individuals
who have not grown up playing these sports. These individuals may prefer
sports such as football (soccer), given its worldwide popularity and simple
rules. In this case, the introduction of the A-League’s Western Sydney
Wanderers provided an opportunity for these residents to follow a sport they
have directly experienced and that suits their interests.
An individual’s geographical access to a particular sport can also influence
sport consumption. For example, the Gold Coast is a region that typically
attracts large numbers of tourists and relocated residents from Australia’s
southern and western states – locations where the AFL is the dominant sport.
The inclusion of the Gold Coast Suns allowed these individuals the chance to
follow their favourite sport while also giving other individuals yet to be exposed
to the AFL a chance to engage with the sport. In summary, sport organisations
wishing to introduce a new sport product or expand an existing one must
understand how existing psychological, personal, social and situational factors
influence sport consumption.
The previous discussion of the sport experience design and four factors that
influence consumer buying and using behaviour provides a foundational
understanding of sport consumer behaviour. Returning to Figure 3.1, there are
also five boxes arranged across the bottom portion to represent the consumer
 decision-making process that also influences consumer buying and using
behaviour. These five boxes are considered sequential stages that a consumer
goes through to acquire and experience a sport product. The personal,
psychological, social and situational factors previously discussed can also
influence each stage. The next section provides a discussion of the consumer
decision-making process.

The sport consumer decision-making process

The sport consumer decision-making process occurs in five stages: (1) problem
recognition, (2) information search, (3) evaluation of alternatives, (4) decision
and (5) use and evaluation (Schiffman & Wisenblit, 2019). To exemplify this
process, ‘Pat’s’ decision to attend Australia’s premier tennis event, the Australian
Open, is used. The Australian Open is held each January in Melbourne, Victoria.

Stage 1: Problem recognition

Problem recognition occurs based on a perception that a current condition is
different from a desired condition. This creates a psychological imbalance that
can be restored by buying and using a sport product to solve a problem, which
typically involves satisfying needs and wants. There are several ways in which a
problem may be recognised. A consumer: (a) may become frustrated with a
product that performs poorly or is no longer functioning correctly – e.g., a seven-
year-old road bike’s aluminium frame is bent or its wheels are in bad shape; (b)
has used a product and now wishes to replace it – e.g., needs new tubes for the
bike’s tyres); or (c) becomes aware of a product that outperforms the current
product being used – e.g., a newer bike model exists with a carbon frame and disk
brakes).
The following example of a spectator sport is useful to consider. Pat is feeling
bored while sitting in her apartment. She believes outside entertainment options
in late January are not desirable, due to the heat. Pat thinks attending a movie is
less appealing because the cinema does not allow the opportunity to chat with
friends. She has begun to hang out with a new group of friends from the sport
marketing course at university. This new reference group provides a shared
interest in sport that is appealing, and Pat wants to spend time with these friends.
In addition, the amount of general media, advertising and social media coverage
devoted to the Australia Open suggests that attending may be a lot of fun. The
recognition of a problem for Pat creates a desire to find a new form of
entertainment that will accommodate particular social needs. This problem
recognition prompts Pat to seek out and gather information to make an informed
choice.

Stage 2: Information search

The information search stage can take one of two forms: a recall of knowledge
from memory, and seeking out additional information. Some products and related
brands are bought solely based on an internal memory search and are usually
related to habitual or routine problem-solving behaviour or inexpensive products.
Here, information is limited and based on what is recalled about buying and using
the sport product previously. Pat is aware of a range of entertainment options
available – such as the movies, going out to dinner, the theatre or clubs, or
attending a sporting event. Through an external information search she is seeking
information not available from memory and will utilise personal, commercial and
public sources. These sources can include online and offline resources such as
internet, search engines, product and consumer reviews, social media, advertising,
sales and product trail, and asking friends, family and work colleagues for
recommendations.
Conducting an external search is usually a response to reducing risk. Risk
involves recognising that making a purchase could produce a negative
consequence of a poor choice and believing that collecting more information will
greatly increase the chances of making a good choice. In general, more expensive
products that are personally important require extended problem-solving
behaviour. For example, Pat may search for information on current events in
Melbourne and see what her friends feel like doing. At this stage, general
information about the range of entertainment options available is collected and
complemented by more specific information about particular options and how
important the friends are to Pat: e.g., Can I go with my friends? Can I chat during
the event? What is the cost? The amount of information collected helps Pat
identify and evaluate different options in the third stage of the decision-making
process.

Stage 3: Evaluation of alternatives

The third stage of the consumer decision-making process is the evaluation of
alternatives. This stage is affected by a consumer’s perception about a certain
product, prior experience and knowledge, and information collected from the
previous stage. As such, the consumer identifies and evaluates the likelihood that
buying and using various sport products and related brands can solve the
recognised problem from Stage 1. The evaluation of potential options is
conducted using an established set of evaluative criteria. These criteria can
include tangible features of the product, such as comparing three running shoe
brands based on price, fabric, comfort and colour. For spectator sports, consumers
can evaluate sport teams based on associations such as star player, venue, head
coach, success and team logo (Gladden & Funk, 2002). The evaluative criteria
can also include intangible features of a live sporting event, such as image,
dependability, responsiveness, safety, socialisation and excitement. Consumers
can mentally assign importance to specific product features such as ‘must have’
criteria versus ‘nice to have’ criteria. In addition, the evaluative criteria can be
ranked in terms of importance to allow consumer to compare and make trade-offs
(e.g., giving up one feature to get another feature that is more desirable). It is
critical for sport organisations to understand how consumers develop and use
evaluative criteria to increase the attractiveness of their products. This can be
done by designing a sport product that has features most desired by consumers
based on important evaluative criteria. In addition, educating consumers about
what features a product or brand offers or how it outperforms a competitor can
also influence the formation and importance of evaluative criteria used for a
decision.
For Pat, the potential number of entertainment options to select is narrowed
down to a smaller set of options that can solve a recognised problem in Stage 1.
For example, the theatre is for her parents; during movies one is not supposed to
talk; and going out for dinner is not that exciting. Conversely, going to a live
sport or culture event offers scope to spend time with friends while being
entertained. But Melbourne can be very hot in January, so it might be better to
attend an event held at an indoor venue or attend during the evening at an outdoor
venue. Given Melbourne has several sport and cultural events most weekends
during the summer, Pat will be required to narrow the potential options down
even further. Here, the Australian Open is part of the considered set of
entertainment options related to attending a live event. The consideration set is a
reduced number of options from a larger awareness set of products and related
brands the consumer is now evaluating to buy or use (Shocker et al., 1991). Based
on research and collecting information about various events and seating cost, Pat
finds out that tickets for most weekend events are expensive, and decides that
spending time in one seat location would limit the ability to move around. At this
point, Pat now moves on to the fourth step of deciding on which option to choose.

Stage 4: Decision
The fourth stage, decision, reflects taking action to select one specific product
option and taking possession of it. In general, a decision is a choice a consumer
makes when presented with multiple options (Payne et al., 1992). Based on Stage
3, a consumer has narrowed down the potential options to a smaller consideration
set, and will now consider the decision type, decision condition and decision rule
to be applied.
Decision types can be programmed or unprogrammed. Programmed decisions
are predictable and use established criteria such as features of each product to
compare different brands. For example, comparing three brands of running shoes
to purchase based on price, fabric, colour, comfort, durability and image.
Unprogrammed decisions are more distinctive and require more extensive
problem solving, and likely establishing additional criteria due to potential risk.
Decision-making conditions are based on the level of certainty as consumers
are generally risk-averse. Under conditions of certainty, a consumer knows each
product and related brand options being considered, has already established
evaluative criteria to be used, and can reasonably anticipate the consequences of
buying and using each product. For most consumers, determining which brand of
running shoes to purchase is less risky than purchasing a Peloton bike or
treadmill.
Decision rules are either attribute-based or attitude-based. Attribute-based
rules require knowledge of specific product and brand features to compare, using
either non-compensatory or compensatory rules. A non-compensatory rule
involves selecting an option based on features (e.g., price, fabric, colour,
durability, image) that meet or exceed an acceptable cut-off point established by
the consumer for each feature. Any product or brand falling below the cut-off
point will be eliminated from further consideration. A compensatory rule allows
the consumer to average across all features, and a higher ranking on one feature
can offset a lower ranking on another (e.g., price is more important than colour).
Attitude-based rules are more subjective and involve using perceptions, feelings,
mood, cognitive biases and heuristics to make a decision with limited feature
comparisons. In general, the specific decision rule applied often depends upon the
consumer, the product and the situation.
Returning to Pat, she has now identified that attending the Australian Open is
the optimal decision to solve the problem of reducing boredom and finding an
opportunity to spend time with friends. After making a decision, Pat finds out that
some event sessions are sold out and rain is forecast for the weekend. Here a
decision has to be made as to whether to purchase tickets now, how much to
spend, to wait and purchase a ticket on the day just to be sure of the weather, or to
not purchase a ticket at all and choose another option. In addition, Pat must
determine whether to purchase tickets online or from a traditional retail store.
Hence, a decision can be influenced by previous experiences, time and location,
negative feedback from others, budget constraints and return policies. After some
more deliberation, Pat decides to purchase a one-day ground pass with her
friends, and moves to the final stage of the consumer decision-making process.

Stage 5: Use and evaluation

The final stage involves the use and evaluation of a sport product. This stage
differs from the previous four stages which occur before or during a purchase
decision that primarily focus on buying or acquiring behaviour. The final stage
shifts the focus to using behaviour given that possession of sport product has
occurred either via physical or virtual means. As a result, the focus is on what
consumers ‘think’, ‘do’ and ‘feel’ while using the sport product. In general, there
are three possible outcomes from using and evaluating a sport product which are
related to satisfaction; in other words, whether the sport product met, exceeded or
failed to live up to expectations. First, the consumer is entirely satisfied with the
purchase and no further information is required. Pat feels that attending the Open
was the most fun she had ever had at a sporting event. It was great entertainment
for the price. Pat got to see some star players and had a great time with friends.
Second, the consumer is not entirely satisfied with the decision and may need to
reappraise the alternatives gathered through the initial information search, or may
seek out new information. After attending, Pat felt the day was a bit ordinary and
would probably not rush back unless a large group of friends was going. There
were too many people, all the good matches were on Centre Court and the price
of food and drinks was a bit over the top. Third, the consumer is dissatisfied with
using the product: they may decide that the solution to the initial problem was not
solved, and may look for other solutions next time. For example, Pat felt the
Open was no fun: ‘Perhaps I should go to the beach with my friends next time!’
There are two important aspects in the final stage of decision-making that
should be highlighted. First, consumers will devote effort using, learning and
evaluating whether a sport product and its features helped solve the initial
problem recognised. When a product does not live up to expectations, or other
information becomes available about other options (e.g., cheaper, more and better
features), the consumer may experience post-purchase anxiety or regret. This
reflects the concept of cognitive dissonance, which describes a mental state in
which a consumer holds conflicting beliefs about a decision that was made. The
second important aspect is the existence of a feedback loop, depicted by dotted
lines at the bottom of Figure 3.1. This feedback loop occurs because future
decisions are informed by knowledge gained from using and evaluating the sport
product. As a result, this stage influences each of the preceding four stages by
informing problem recognition, information search, evaluation of alternatives,
and the effectiveness of decision rules. For example, Pat had previously
purchased tickets for and attended live sporting events, so deciding to attend the
Open would draw upon this knowledge and experience to evaluate a future
decision.

Involvement and decision-making

The preceding section discussed how the decision-making process influences
buying and using behaviour of sport products. A key aspect of this process is how
important the sport product is to the consumer. This reflects the concept of
consumer involvement, which describes a consumer’s level of interest, arousal
and motivation to buy and use a sport product. Effectively, involvement
represents how much a consumer cares about a sport product, and the
psychological consequences of buying and using it. As a result, the amount of
time and effort devoted to purchasing and using a sport product can vary
considerably, depending on the product, the situation and the consumer’s level of
involvement.
The role of sport involvement in consumer research has been well
documented. In terms of the decision-making, the level of sport involvement
operates as a key psychological factor that explains behaviour. The next section
provides some examples of high- and low-involvement decision-making.

High-involvement decisions
High-involvement purchases make full and extended use of the decision-making
process. High-involvement decisions are more risky, complex and expensive, and
include extended problem-solving behaviour. For example, purchasing golf clubs,
Peloton equipment, a Fitbit or club membership may reflect high involvement. In
these cases, the consumer will invariably undertake a thorough information
search, and carefully and selectively examine comparable features. The consumer
may assess value for money – although cost may not be the major factor where
special features, status or functionality are required. Finally, time will be allocated
to the decision-making process, and the positives and negatives of the purchase
will be considered. Once a tentative decision to buy has been made, affirmation
may be sought from an external source such as an expert in the field, a product
review or from a trusted friend.
Sport-marketing strategies aimed at consumers with high involvement should
adopt an approach designed to attract greater attention to marketing
communication. Funk and Pritchard (2006) report that committed (highly
involved) sport fans put forth more mental effort to read and evaluate content
about a favourite professional sport team than non-committed (low-involved)
individuals. This research illustrates how high involvement can cue internal
processing that prompts cognitive effort related to information search activity,
comprehending information received, and influences evaluation of features and
options. As a result, highly involved individuals will exert greater mental effort in
processing content as well as evaluating the applicability and credibility of the
information. This may include the provision of maximum levels of technical
information or personal support for the service or product’s use, and reinforcing
the wisdom of the purchase choice. For example, marketing content used to
advertise a marathon event to highly involved runners should utilise race-specific
information that includes detailed race information, including characteristics of
the course, climate conditions and technical aspects of the timing systems utilised
for the event. As with any advertising, the appropriate market segment – such as
involvement level – should be considered in creating the content.
Sport-marketing strategies can also leverage high involvement with a sporting
club, league or event to attract corporate partners. Sport sponsorship is a
communication vehicle used by corporations to increase the threshold of
purchasing products such as cars, insurance and mobile phones, which often
require long-term commitment through contracts and have greater risk. For
sponsors, using sport in their sponsorship communications mix means the
threshold of purchasing high-involvement products should theoretically be
lowered. The corporate partner can manage the decision-making process of a
high-involvement purchase by linking the product to a sporting organisation
(team, player or event) that a consumer considers as personally important.

Low-involvement decisions
Low-involvement purchases occur when the product to be consumed is socially
or psychologically unimportant, and the consequences of a poor choice are
minimal. Low-involvement decisions are more straightforward, repetitive, less
expensive, have limited risk and include minimal problem-solving behaviour. For
example, laces for running shoes, sport drinks, gym shorts or T-shirts are
considered low-involvement purchases. Hence information can be acquired
internally based on experience and memory, and the decision to buy and use can
be made with limited effort and evaluation. The sport industry competes with
other entertainment options for consumers in a general market. For example, most
individuals living in Sydney and surrounding suburbs are likely aware of the
professional sporting teams that play in the city, and may even watch a game on
TV or follow the news periodically, but do not purchase club membership or
attend matches. As a result, these low-involved consumers will focus primarily on
evaluating whether a sport experience provides opportunities to satisfy needs and
wants related to SPEED motives previously discussed.
The use of advertising and the role of the media among the less involved is
important. In establishing an advertising strategy aimed at consumers exhibiting
low involvement in the purchase process, sport marketers need to: provide
educational content and information; encourage familiarity; offer a variety of
inducements; create attention-grabbing point-of-purchase (POP) displays; utilise
social media and AdWords to optimise search; and, if possible, distribute through
multiple platforms and channels. Sport-marketing strategies can also leverage
corporate sponsorship opportunities to market products that require a less-
involved decision-making process. Professional sport teams can partner with
companies that make convenience products that are purchased and used
frequently, such as beverages, fuel, clothing and food. Based on these examples,
the sporting team or event provides a strategic platform to market low-
involvement products for these companies.
In summary, consumer involvement is an important motivational factor that
influences buying and using behaviour for sport products. The level of
involvement determines the amount of time and effort devoted to decision-
making, and can vary based on the product type and the situational context. To
better understand how involvement and other cognitive processes work within
decision-making, a framework called the Psychological Continuum Model (PCM)
was developed (Funk & James, 2001, 2006) (see Figure 3.2). The PCM describes
how personal, psychological, social and situational factors influence a consumer’s
mental connection to a sport product, and subsequent behaviour. This connection
represents a consumer’s psychological state regarding a specific sport product and
related brand that is relatively constant but can also change overtime due to
various internal and external factors. For example, in the previous section Pat’s
existing connection to tennis, the Open event or friends can influence buying and
using behaviour. The following section provides a discussion of the PCM
framework.
 Figure 3.2 Psychological Continuum Model.

A model of sport consumer behaviour

The Psychological Continuum Model is a stage-based framework to understand
sport consumer behaviour. It characterises four psychological connections that
consumers form toward products and related brands. These progress upward
along four stages of awareness, attraction, attachment and allegiance (Figure 3.2).
As a result, the PCM integrates decision-making into the stage-based framework
by outlining internal and external factors and responses at each stage in order to
better explain how the psychological connection progressively forms (Funk,
2008).
Figure 3.2 should be examined as a linear continuum with stages, beginning at
the bottom with the awareness stage and proceeding upwards through stages of
attraction and attachment to allegiance. Each stage represents a different
psychological connection that a consumer forms with a sport product or related
brand (for example, sport, league, team, player, event, recreational activity,
speciality clothing, equipment). As the consumer progresses to a higher stage, the
psychological connection becomes incrementally stronger. The PCM stages are
placed in a linear progression in Figure 3.2 to highlight how cognitive and
behavioural engagement are positively correlated. For example, a consumer’s
cognitive and behavioural engagement increases as progress through the stages of
the PCM occurs. The level of cognitive engagement is represented on the vertical
axis, ranging from ‘Low’ to ‘High’, and represents the degree of mental effort
consumers put forth to search, purchase, use and evaluate a sport product.
Behavioural engagement is represented on the horizontal axis, and also ranges
from Low to High. Behavioural engagement represents the frequency and type of
consumption activities, which can range from no behaviour to infrequent and
unpredictable, to consistent and regular. A discussion of each stage is provided
next with an example of how an individual becomes increasingly connected to the
Brisbane Lions, a professional AFL franchise.

Awareness
The ground floor is the awareness stage, where a consumer enters the PCM
elevator. Awareness reflects the statement ‘I know about the Brisbane Lions’,
indicating that an initial psychological connection with the team has formed. The
awareness stage is influenced by internal and external factors that determine how
consumers learn about the Lions as a professional football franchise. At this
initial stage, social and situational factors are particularly influential in creating
awareness. Cognitive engagement is low and includes knowledge and realisation
that the sport team exists. At this stage, the consumer is likely indifferent to the
team, with no to limited prior knowledge and experience, and does not evaluate
the team as positive or negative. Within awareness, behavioural engagement is
non-existent or minimal as the consumer will not actively engage in searching for
information, purchasing or using Lions’ products. For example, watching an
occasional Lions’ game on TV while vising friends would indicate an awareness
stage connection.

Attraction
The attraction stage is reflected by the statement ‘I like the Brisbane Lions’,
indicating that movement upwards has occurred within the PCM. Although the
connection in the attraction stage is stronger than in awareness, it is still relatively
weak and unstable. External and internal factors continue their influence and take
on more significance, such as how the Lions can satisfy entertainment needs and
wants. Cognitive engagement is still relatively low, but positive effect emerges as
the consumer now associates the Lions with the opportunity to satisfy needs and
provide benefits, which helps the consumer learn about and evaluate the Lions as
a possible option for entertainment. At this stage, the consumer may consider
buying and using Lions’ products, and begins to establish a set of evaluative
criteria to make such decisions. Behavioural engagement is relatively low and
unpredictable as the consumer now begins to watch games periodically, may even
attend a game, and occasionally reads and talks about the team with friends,
family and colleagues.
Attachment
The attachment stage is reflected by the statement ‘I am a Brisbane Lion’, and
suggests that the psychological connection with the team has strengthened and
progressed upward. While this connection is still influenced by external and
internal factors, internal factors – and particularly psychological factors – become
important and indicate that the team is becoming part of the consumers’ self-
concept. Cognitive engagement for this stage increases as the consumer now puts
forth more effort on buying and using Lions’ products, and places functional,
emotional and symbolic meaning on those products. Behavioural engagement
also increases as the consumer begins performing behaviours such as attending
and watching live games, engaging in rituals that other Lions’ fans expect,
following the team or players on social media, visiting the team website for
updates or wearing team merchandise to signal to others an association with the
team.

Allegiance
The final stage, allegiance, is reflected by the statement ‘I live for the Brisbane
Lions’, and represents the strongest psychological connection to the team within
the stage-based continuum. External and internal factors continue to be influential
as the team is considered as promoting core values (e.g., family, honesty, safety,
reliability) that are congruent with the consumer’s own values and makes
expressing an identity linked with the team meaningful. This creates a sense of
psychological commitment and loyalty to the Lions. Cognitive engagement is the
highest and includes the most effort and time devoted to selecting, using and
evaluating Lions’ products. This level of engagement can also introduce a
cognitive bias that influences the way a consumer processes information and
situations related to the team. Behavioural engagement that began in the
attachment stage continues but will be more consistent over time, predictable and
involve multiple forms of behaviour related to the team and related products (e.g.,
watching, attending, reading, talking, following and wearing).
In summary, the PCM framework explains how a consumer’s psychological
connection forms and progressively grows stronger within four stages. This
connection reflects a psychological state which corresponds to different cognitive
and physical responses that emerge related to buying and using sport products and
related brands. The PCM also recognises that a consumer may move upward or
downward or stay at a certain stage. Although a consumer may not skip a stage,
the amount of time spent within a specific stage or the speed of movement
between stages depends upon the consumer, the product and the situation. Hence
consumers may have unique trajectories in terms of movement based on internal
and external factors and the decision-making process. Researchers have also
developed a segmentation algorithm to place consumers in one of the four PCM
stages in order to compare consumers within and across stages as well as tracking
movement over time (e.g., see Beaton et al., 2009; Doyle et al., 2013). This
knowledge can help organisations develop tactics targeted at certain consumer
segments and design better sport experiences that focus on improving customer–
organisation interactions to enhance use and satisfaction in order to promote
upward movement, maintain stage level status and reduce downward movement.
In terms of movement with the PCM, there are several situational and
individual constraints that could alter movement each stage (Alexandris et al.,
2017). Constraints create ‘obstacles’ or ‘barriers’ that prevent sport-consumption
activity. Lepisto and Hannaford (1980) identify five marketing barriers that could
influence buying and using behaviour:

1. marketing constraints, which depict the failed fit between product and
consumer
2. cultural constraints, which act as prevailing cultural norms and values that
might inhibit patronage
3. social constraints, which are the influence of reference groups and social
expectations on action
4. personal constraints, which stem from the consumer’s lifestyle, or pattern of
living or use
5. and finally structural constraints, which curtail patronage as a result of
certain physical, temporal or spatial challenges.

Summary
Understanding the sport consumer is not a simple task. While behaviour can be
readily observed, the cognitive aspects of the human brain that influence and
explain this behaviour are hidden. As a result, buying and using sport products is
a dynamic and complex process. Comprehending the complexity of this process is
one of the more intricate tasks facing the sport marketer; indeed, it
unquestionably has become a critical part of the marketing-management strategy.
Although it is not always possible to fully understand how this process takes
place, attention to the sport experience design – coupled with awareness of
personal, psychological, social and situational factors that influence sport
consumption and the decision-making process – will provide the sport marketer
with a foundation on which marketing strategies can be developed. In addition,
advances in consumer behaviour research have provided sport marketers with a
holistic framework called the Psychological Continuum Model to help investigate
and determine the relative influence of these factors on consumers to optimise
marketing and management tactics for different consumer segments.

CASE STUDY
AFL expansion
Jason Doyle
The Australian sports marketplace represents a competitive landscape. Sport
is a deeply entrenched way of life for most Australians, who have a vast
selection of sports they can choose to participate in and/or follow as spectators.
From the spectator perspective, Australia is also the only country where four
codes – Australian Rules football (AFL), rugby league (NRL), rugby union
(Super Rugby) and soccer (A-League) – compete for the title of ‘football’.
Usually, the code referred to simply as ‘football’ is their personal favourite –
typically determined by where a person lives or their cultural background.
Although each code enjoys some popularity across the nation, the AFL and
NRL are traditionally seen as Australia’s two most popular spectator sports.
While the AFL enjoys a dominant following in the southern (Victoria, South
Australia, Tasmania) and central/western states (Western Australia, Northern
Territory), the NRL remains the sport of choice for the majority in Queensland
and New South Wales.
In an attempt to increase market share, the AFL bolstered its presence in both
Queensland and New South Wales. Introducing new teams to these regions
represented a strategic approach designed to increase overall exposure to the
game, and create rivalries with the existing AFL teams available to sport
consumers. This approach saw the Gold Coast Suns become the second
Queensland team (joining the Brisbane Lions) and the Greater Western Sydney
Giants (GWS) introduced as New South Wales’ second AFL team (alongside
the Sydney Swans).
Along with the challenges traditionally faced by new teams entering a
congested sport marketplace, the Gold Coast Suns are an example of a team that
has had to overcome additional barriers stemming from the team’s geographic
location. First, the sport of choice for Gold Coasters has traditionally been
rugby league, with Australian Rules capturing a smaller market. Second,
although the Gold Coast is Australia’s sixth largest city and one of the country’s
fastest-growing areas, it has typically struggled to support professional sport
franchises, with various rugby league, soccer, basketball and baseball teams
 unable to avoid collapse. For these reasons, many people were sceptical of the
team’s longevity when the Suns entered the AFL competition in 2011.
The Gold Coast Suns have experienced a tough inaugural decade, which
resulted in them finishing low on the ladder in most seasons to date. Despite the
lack of on-field success, the club was successful in signing up 14,064 members
(or season ticket holders), and enjoyed a healthy home crowd average of 19,169
during the early years. Off-field successes such as awards for community
engagement and game experience were also highlights for the club. In a sign
that the novelty of the new team may have been wearing off, average home
crowd figures have dropped from these inaugural season benchmarks, although
member numbers remain strong. These decreases meant that fewer people went
to the stadium to support the team and less revenue was generated through
ticket sales and other means.
This case highlights the strategic decision-making behind introducing new
sporting teams, and outlines the challenges that can arise in managing these
franchises.

Questions
1. Based on the concept of sport experience design: (a) What are key
organisation–consumer–context interactions that would occur when
purchasing an admission ticket and then attending a live sporting event?
(b) What are key organisation–consumer–context interactions that would
occur when visiting and working out at a local fitness gym? Compare and
contrast these interactions with a virtual or digital experience of watching a
game or working out at home.
2. Consider the personal, psychological, social and situational factors that
influence attending a traditional live sporting event such as an AFL or
NRL game versus attending an esports event. Identify key factors. Are
these factors similar or different?
3. Based on the stages of the consumer decision-making process, what
marketing mix tactics could you use to entice a consumer to purchase a
ticket and attend a live sporting event for the first time?
4. For consumers in the attraction stage of the PCM toward running, how
could you use digital marketing to increase registration in a 10k road race?

References
Alexandris, K., Du, J., & Funk, D.C. (2016). The influence of sport activity
personality on the stage-based development of attitude formation among
recreational mountain skiers. Managing Sport and Leisure, 21, 4, 218–238.
Alexandris, K., Du, J., Funk, D.C., & Theodorakis, N.D. (2017). Leisure
constraints and the psychological continuum model: A study among
recreational mountain skiers. Leisure Studies, 36(5), 670–683.
Alexandris, K., Kouthouris, C., Funk, D.C., & Chatzigianni, E. (2008).
Examining the relationships among leisure constraints, involvement and
attitudinal loyalty among recreational skiers. European Sport Management
Quarterly, 8, 247–264.
Beaton, A., Funk, D.C., & Alexandris, A. (2009). Operationalizing a theory
of participation in physically active leisure. Journal of Leisure Research,
41,177–203.
Doyle, J., Filo, K., McDonald, H., & Funk, D.C. (2013). Exploring sport
brand double jeopardy: The link between market share and attitudinal
loyalty. Sport Management Review, 16, 3, 285–297.
Doyle, J., Kunkel, T., & Funk, D.C. (2013). Sport spectator segmentation:
Examining the differing psychological connections among spectators of
leagues and teams. International Journal of Sport Management and
Sponsorship, 14, 2,95–111.
Funk, D.C. (2008). Consumer behaviour for sport and events: Marketing
action. Elsevier, Oxford, UK.
Funk, D.C. (2017). Introducing a Sport Experience Design (SX) framework
for sport consumer behaviour research. Sport Management Review, 20, 145–
158.
Funk, D.C., & James, J. (2001). The psychological continuum model: A
conceptual framework for understanding an individual’s psychological
connection to sport. Sport Management Review, 2, 119–150.
Funk, D.C., & James, J. (2004). The Fan Attitude Network (FAN) model:
Propositions for exploring identity and attitude formation among sport
consumers. Sport Management Review, 7, 1–26.
Funk, D.C., & James, J. (2006). Consumer loyalty: The meaning of
attachment in the development of sport team allegiance. Journal of Sport
Management, 20, 189–217.
Funk, D.C., & Pritchard, M. (2006). Sport publicity: Commitment’s
moderation of message effects. Journal of Business Research, 59,613–621.
Funk, D.C., Alexandris, K., & McDonald, H. (2016). Sport consumer
behaviour: Marketing strategies. Routledge, Abingdon, UK.
Funk, D.C., Filo, K., Beaton, A., & Pritchard, M. (2009). Measuring motives
for sport event attendance: Bridging the academic-practitioner divide. Sport
Marketing Quarterly, 18, 126–138.
Gladden, J.M., & Funk, D.C. (2002). Developing an understanding of brand
associations in team sport: Empirical evidence from consumers of
professional sport. Journal of Sport Management, 16(1), 54–81.
Karg, A. (2020). Australian Sport Interest and Opportunities for Media
Consumption Growth. Swinburne Sport Innovation Research Group report.
Kennedy, H., Kunkel, T., & Funk, D.C. (2021). Using predictive analytics to
measure effectiveness of social media engagement: A digital measurement
perspective. Sport Marketing Quarterly (accepted July 16, 2020).
Lee, Y.S., & Funk, D.C. (2011). Recreational sports participation and
migrants’ acculturation. Managing Leisure, 16, 1–16.
Lepisto, L.R., & Hannaford, W.J. (1980). Purchase constraint analysis: An
alternative perspective for marketers. Journal of the Academy of Marketing
Science, 8(1), 12–25.
Payne, J.W., Bettman, J.R., & Johnson, E.J. (1992). Behavioral decision
research: A constructive processing perspective. Annual Review of
Psychology, 43, 87–131.
Pritchard, M., Funk, D.C., & Alexandris, A. (2009). Barriers to repeat
patronage: The impact of spectator constraints. European Journal of
Marketing, 43, 169–187.
Schiffman, L.G., & Wisenblit, J.L. (2019). Consumer behavior (12th edn).
Pearson Education, Harlow, UK.
Shocker, A.D., Ben-Akiva, M., Boccara, B., & Nedungadi, P. (1991).
Consideration set influences on consumer decision-making and choice:
Issues, models, and suggestions. Marketing Letters, 2(3), 181–197.
CHAPTER 4

Sport market research and

strategy

DOI: 10.4324/9781003270522-6

Chapter objectives
 Chapter 4 provides a foundation to understand market research and strategy,
and identifies the role of information and data as critical components of sport
marketing. First, four components of a marketing information system are
described, consisting of Internal Data and Reports, Market Intelligence,
Analytics Software and Market Research. Second, a more detailed discussion of
how to conduct market research is provided, and various data-collection
methods described. Third, various consumer segmentation methods are
presented to illustrate how to identify consumer segments and create profiles
and personas. Finally, the strategic selection of target markets and positioning as
relevant to sport marketing is discussed.
After studying this chapter you should be able to:

describe basic components of a marketing information system

understand how to conduct market research and utilise various types of
information collected
describe different market segmentation methods
develop consumer profiles and personas
understand the rationale for the selection of target markets
appreciate the concept of positioning.

Headline story
Positioning esports as a growth strategy: market research at work
Esports are a subsector of the increasingly popular video game industry. The
growth of esports has been facilitated by sport organisations, video game
publishers, content distribution platforms, consumers and event organisers.
Professional sport leagues and event organisations have entered the esports
space in the form of, for example, NBA 2K, eMLS Cup, the FIFA eClub World
Cup, Overwatch, the League of Legends World Championship and the Fortnite
World Cup. Despite increasing popularity, esports remains a topic of debate as
to whether esports are sport and whether professional sport organisations should
position esports as an entertainment product to counteract declining attendance
patterns (Funk et al., 2018).
The president of US cable sports channel ESPN stated that esports are not
sport, and likened esports to a competition of chess or checkers. Yet, ESPN’s
website includes a dedicated esports section with the same level of menu bar
prominence as well-accepted sports such as golf, tennis, cricket, boxing, mixed
martial arts (MMA), Olympic sports, F1 and rugby. In addition, esports have the
makings of mainstream sports, including players, teams, managers, leagues,
competitions, marque events, endorsement deals and player transfer fees, as
well as a dark side including match fixing, doping and gender-related disputes.
As a result, sport organisations are questioning whether to position esports as a
product development strategy for existing consumers or a diversification
strategy to attract new consumers. Research was used to help inform this
question by examining whether spectators attend esports events for different
reasons than traditional sport events (Pizzo et al., 2018).
A study was conducted at three events in Seoul, South Korea. The first event
was a traditional sport competition of a Korean professional soccer league (K-
League) match at Tancheon Stadium. The second event was an esports video
game competition with a sport focus, FIFA Online 3, at the Nexon Arena. The
third event was an esports competition with no sport focus, StarCraft II, also at
the Nexon Arena. A total of 489 spectators were surveyed at the three events:
168 for FIFA Online 3, 136 for StarCraft II and 185 for K-League. Spectators
were approached, and completed a questionnaire to collect demographic
information and reasons why they attended the event using 14 traditional
spectator motives of vicarious achievement, excitement, interest in team,
aesthetics, social opportunities, drama, role model, entertainment value,
wholesome environment, family bonding, acquisition of knowledge, physical
skill of the athletes, physical attractiveness and enjoyment of aggression.
Overall, the study found that esports and traditional soccer spectators share
common motives and demographics. Specifically, 80 per cent of the 14 motives
were similar regardless of event or game type. Key differences observed were
that K-League spectators were older and rated opportunity to bond with family,
physical attractiveness of athletes and vicarious achievement slightly higher
than FIFA Online 3 and StarCraft II spectators. These results indicate that
although esports competitions and events may attract a younger demographic
than traditional sport, from a consumer entertainment perspective reasons for
attending should be considered similar. As a result, professional sport leagues
can utilise esports as a ‘hybrid’ growth strategy: both as a product development
and a diversification strategy that involves the introduction of a new
entertainment product to an existing market of traditional spectators and a new
market of younger esports spectators. The emergence of esports demonstrates
the positive influence of sport market research to inform decision-making and
better understand sport consumer behaviour.
Market research and strategy
The headline story demonstrates that information is power: the power to make
informed decisions. Sport marketing research consists of activities designed to
make good business decisions. These activities attempt to match the needs and
wants of consumers with product development and strategy to increase and
maintain consumer demand. Developing a marketing approach that strategically
positions the marketing mix requires an understanding of the sport consumer.
Chapter 3’s study of sport consumer behaviour provides the necessary foundation
from which to develop a successful market research strategy.
There is little doubt that in order to make informed decisions, organisations
need information. Market research involves collecting, analysing and interpreting
data about existing products, consumers, the business climate and new product
development. Market strategy involves the use of this information to create and
implement tactics to reach existing and new consumers in order to secure
resources and be successful. Mullin et al. (2000, p. 99) suggest that:

the most critical factor in marketing success is the marketers’ ability to

collect accurate and timely information about consumers and potential
consumers and to use this data to create marketing plans that are specifically
targeted to meet the needs of the specific consumer groups.

The collection of information is a starting point for the construction of a

marketing information system (MIS). Time spent on its assembly, maintenance
and development can be the most effective marketing tool at an organisation’s
disposal.

Developing marketing information systems

A MIS is defined as an ‘ongoing, organised set of procedures and methods
designed to generate, analyse, disseminate, store and later retrieve information for
use in decision making’ (Stanton et al., 1995, p. 48). It can range from a paper-
based system to a computer-based system to manage information that an
organisation has or collects. The MIS represents a resource to develop marketing
strategies, along with mechanisms for monitoring effectiveness. For the MIS to
be successful, the data should be of high quality, derived from both internal and
external sources, used in a realistic manner and adopted as a source of decision-
making by the organisation. As a result, information collected should reflect
personal, psychological, social and situational factors discussed in Chapter 3 that
influence buying and using behaviour of sport products. Figure 4.1 provides a
basic design for an effective MIS.

Figure 4.1 Basic management information system.

Internal data and reports

Internal data and reports represent a system for accessing and recording data
obtained from internal sources within an organisation to generate reports. This
system can include information from an intranet platform designed for employees
and managers, such as records and basic enquiries that the organisation collects
during the day-to-day operation of its business (e.g., ticket sales, registration data,
membership forms, social media, credit card purchases, payment methods,
inventory levels and customer returns, along with complaints, enquiries, emails,
letters, telephone calls and employee perceptions). Such information can also
come from websites via software that captures clickstream data to monitor page
views and browsing patterns as well as capturing and extracting data from social
networks to track behaviour, trends and sentiments. Promotions and sweepstakes
that require a consumer to provide personal information for a chance to win a
prize are useful means of collecting primary data. All can offer the sport marketer
useful advice, and any such comments should be heeded. Internal information is
combined and stored in a data warehouse that can be mined by marketers to
generate reports. All that is required is access to the information source, time,
energy and good questions.

Analytics software
Marketing analytics software is designed to help sport organisations analyse and
interpret data not found in internal reports. Such software allows for existing
internal data or new data collected to be manipulated for a specific purpose,
performs quantitative and qualitative analysis, provides exploratory and
predictive models, and creates output that can be used to gain insight on patterns
and behaviour. The software provides the ability to collect, process and analyse
large amounts of data; allows access by multiple employees and departments
inside the organisation; includes functions such as dashboards and data
visualisation and customisable reports; and allows mobile access and integration
with third-party systems. Microsoft Excel is a versatile and easily accessible tool
that can be used for data analysis, create PivotTables, and develop charts and
graphs. More sophisticated tools include SPSS, which allows for complex
statistical data analyses, as well as R and Python, which require program
language skills to collect data and can perform statistical and predictive analyses.
Analytic software can also measure digital content performance and track user
behaviour. A popular freemium platform is Google Analytics, which can monitor
website and mobile apps visitors.
Increasingly, technological advances have created new opportunities for sport
organisations to capture and mine data from consumers on patterns of digital
behaviour. For example, social media usage, online viewing, app logins and usage
and video views provide insights into what consumers are doing, saying and
thinking.
The emergence of data analytics has created new opportunities for
understanding behaviour that occurs within and outside traditional consumption
boundaries of the sport product – for example, when and how a spectator buys a
ticket, how the spectator arrives at the venue, what a spectator does and buys at
the venue, and how long the spectator stays. In addition, wearable devices and
equipment that record various metrics can provide useful data on consumer
experiences in both spectator and participant sport situations.

Market intelligence
Market intelligence is a system for collecting information from external sources
to learn what is happening outside the firm on an ongoing basis. In general,
information that relates to the broad environment in which the sport organisation
operates can include market size, demographics, habits of residents and workers,
the ways in which individuals choose to spend their leisure time and any specific
trends that will affect the sport – positively or negatively. This information is
particularly important for sport organisations that wish to launch a new product,
redesign an existing product or expand nationally and internationally. Such
expansion decisions should be gauged not only from potential consumer demand
but also from the number of potential corporate sponsors and media outlets that
can support a professional sport or sporting event. It is critical that sporting
organisations are not only aware of who their competitors are but also know the
consumers of a rival’s products. If a sport is jockeying for position in the
marketplace, competitor pricing, promotion, and product breadth and depth
should be noted.
Market intelligence information can be collected from a number of sources. It
can be collected by examining search engine results and competitor websites,
reviewing publications on business trends, attending trade shows, joining industry
associations, consulting with salespeople, speaking with suppliers, corporate
sponsors, contractors and industry experts, and by talking to customers. A
beneficial approach is to monitor reports from government and state agencies
such as the Australian Bureau of Statistics (ABS), state and territory health
organisations such as Victoria Health, the Australian Sport Commission, and
large-scale national population tracking studies such as the AusPlay Survey,
which provides national, state and territory data on different sports and activities.
These are sources that provide basic information that is potentially useful for a
number of sporting organisations.
Libraries and chambers of commerce are other useful sources of information,
especially at the local level. Data relating to trends and uses of local events and
facilities should be held there, as well as the various municipal rules and
regulations governing the conduct of sport events. Larger community libraries,
along with those attached to institutes of higher education, often contain much of
the government or commercial data collected in relation to sport. Chambers of
commerce will hold data relating to the income and expenditure patterns of local
industry, which can assist sport marketers in establishing profiles that may match
their organisation.
While much of this information is proprietary, some of the findings are being
presented at conferences and appearing in academic journals. Likewise, a
growing number of sport marketing academics are being used as market research
consultants and are bringing an ever-increasing repository of skills and
knowledge to their task.
Media companies are constantly engaged in the collection of data. While it
may not be specific to the focus of the sport marketer, information relating to
demographics and psychographics may be useful for sponsorship or advertising.
This is particularly the case when the characteristics of the media information
match a particular sport organisation’s own data. For example, the Australian
advertising industry uses OzTAM data, which is the official source of television
audience measurement. With many sporting organisations establishing interactive
home pages, apps and active social media presences, new opportunities for
establishing enhanced databases are plentiful. Through these media, professional
sport franchises, sporting events and community recreation programmes can
communicate with members and users on a regular basis via technology.
An equally important general question relates to where consumers get their
information. Frequency and type of social media platform used, newspapers read,
websites visited, radio stations listened to, television stations and programmes
viewed and magazines read – both general and specific – are crucial factors in
determining promotional strategies. Sport consumers are now using technology to
access information through social networks. Word of mouth remains an important
source of information for sport consumers, and a market research strategy needs
to be developed to manage this.

Market research
Market research is a system for collecting and recording information to answer
specific questions. There is little doubt that the best data available to the sport
marketer are those that are purpose-driven by the organisation. In this way, direct
answers to specific questions can be obtained. As a result, this component of the
MIS is not considered ongoing but conducted on a need or project basis. The
collection of data through market research is not difficult but can be expensive
and take time, so organisations should consider whether to do it themselves or
hire an outside market research company.
The market research process principally consists of five distinct phases. In
order to optimise results with limited resources and time, the first step in the
process is to clearly define the research question and set a number of measurable
objectives. The research question is a direct derivative of the marketing mission
of the organisation – for example, increase new participation for a marathon event
by 20 per cent or increase membership renewals by 10 per cent. The second step
in the process is to develop a research methodology – that is, to determine which
data sources are needed (primary or secondary) and which methods of data
collection are best used in the context of the research (see below). The third step
then involves the research planning and data collection, who collects the data,
when and where. When all data are collected, they need to be analysed. Data
analysis, as the fourth step in the process, can involve the crunching of
quantitative data (for example, from questionnaires or detecting patterns of digital
engagement) or the interpretation of more qualitative data (such as that obtained
from interviews or focus groups) with the help of software programs. The final
step in the research process is the presentation of the findings in a report so that
the research objectives are achieved and the research problem is answered most
effectively.
In general, market research in sporting organisations seeks to answer six
questions about consumers in relation to their consumption of the product.
Initially, sporting organisations need to know WHO their consumers are, but this
is only the tip of the iceberg. Equally important are WHY they choose the
particular sport product, and WHEN and WHERE that consumption takes place.
WHAT that consumption entails in terms of pre- and post-event activities and
HOW the product is used are also critical in terms of establishing a complete
consumer profile. Mixed-methods research designs, which include both
quantitative and qualitative data-collection phases, are particularly effective for
developing such understandings. As a result, the research design used can assist
with collecting the appropriate information.

Research design
The research design should be of sufficient scope to provide all necessary
information to answer the relevant questions, but short enough to encourage
participation in the process. For example, quantitative approaches using surveys,
data analytics and experiments are useful for collecting information on attitudes
and behaviours from large numbers of consumers for initial strategy and planning
phases: validate product design; focus on what consumers say and will buy;
determine if a new market is available; and identify certain segments as a target
for an existing or new product. Qualitative approaches using focus groups,
interviews and observations are useful for collecting specific information about
the consumer: providing direction about how a sport product could be designed to
meet needs and wants, uncovering what feelings users are having about the sport
product when using it and how consumers actually behave.

Surveys
The personal survey remains a useful research method as it allows the sport
marketer to source first-hand information on the purchasing and consumption
patterns of sport consumers. These data can be collected at the event, by going
door to door in a defined geographical area, at a shopping centre (mall intercepts),
via direct mail or the telephone (telemarketing) and increasingly through the use
of technology with online surveys. As discussed in Chapter 3, sport consumer
behaviour researchers have developed a number of survey tools useful for
collecting information from spectators and participants. Obviously, the more
professional an organisation is and the larger its stakeholder base, the more
sophisticated the survey and its accompanying tools of analyses will become.
Nevertheless, the underlying philosophy remains constant, and that is the
collection of quality information that will assist in answering the research
question(s).

Experimentation
Experimentation can be useful to the sport marketer in specific circumstances.
Here, the researcher or industry professional manipulates one marketing mix
variable while holding all the others constant. Changing the venue, price, time or
day of an event, or altering uniforms (team kits), are just a few of the variables
that professional sport clubs manipulate during a pre-season competition in order
to gauge reaction to such changes. If the changes prove popular, they may be
adopted for the regular season. If not, the previous modus operandi is utilised.
This type of research is particularly useful for evaluating the persuasive impact of
print media, advertising and social media content on the general public and
consumers (Filo & Funk, 2005; Funk & Pritchard, 2006).

Interviews and focus groups

Collecting information from consumers using an interview or focus group
technique can provide valuable consumer insight. Interviews are typically one-on-
one and focus groups generally involve a small group of interested individuals.
Both are used to collect in-depth data on consumers’ thoughts, opinions, feelings
and experiences in terms of what they do and how they use a product. Both forms
gather qualitative data, which usually provide detailed information that can help
answer the research question. Professional sport teams and sport event
organisations often use interviews and focus groups to assist in the creation and
refinement of marketing strategy, as well as collecting operational information.

Observation
Seeing is believing. Although not always undertaken in a formal manner, the
observation technique should be used by the sport marketer on an ongoing basis.
This can entail walking through the stands at a game or among participants at a
race event. Technology can also be used to monitor behaviour during an event
instead of getting out and both talking to the spectators and watching their
behaviour. This simple act can inform sport marketers about which aspects of
their market strategies are having the desired result and which need some work.
During observation, many sport marketers will single out and interview a
spectator or participant at the event on any number of topics. Ideally, the
observation could lead to the focus group, which could lead to the structured
survey, which should then lead to action based on rigorous data collection.
The design and methods used to collect, organise and analyse information are
important aspects of market research to help answer specific questions. One
beneficial application of market research within a MIS is the use of consumer
market segmentation to better understand attitudes and behaviours of sport
consumers.

Segmentation
On any given weekend Australian sport attracts millions of spectators and
participants, who become involved for myriad reasons. Stanton et al. (1995)
suggest that market segmentation is the process of dividing the total,
heterogeneous market for a product or service into several segments, each of
which tends to be homogeneous in all similar aspects. Segmentation creates a
smaller group of consumers from the overall customer base of a sport
organisation who share a common interest. In other words, certain segments of
consumers share similar reasons for buying and using sport products. In an
attempt to encourage or maintain sport or activity consumption, different
marketing strategies can be developed that are specifically aimed or targeted at
such market segments.
Market segmentation allows an organisation to allocate marketing resources
that should result in greater returns on the investment, or ‘more bang for the
buck’. Mullin et al. (2000) suggest that segmentation is central to an
understanding of consumers as it recognises differences in consumer behaviour
which directly inform marketing strategies. Consequently, the task facing sport
marketers is to first determine how and why consumers use sport products to
meet needs and acquire benefits, and then to determine which factors are common
and different. This allows the sport marketer to categorise or group customers
according to the type of people they are, the way they use the product and, finally,
their expectations of it.
Although the segmentation possibilities are endless, there are a number of
approaches that provide an effective starting point for a segmentation strategy.
Commonly, consumers are segmented based on two methods – conceptual and
data-driven. The conceptual approach is based on norms and established practices
such as demographic, psychographic, geographic and behavioural variables that
can guide the segmentation process and analysis. Figure 4.2 presents such
variables schematically. The data-driven method is based on data mining and
analytic techniques of variables to uncover segments not previously known or
anticipated.

Figure 4.2 Market segmentation methods.

Demographic segmentation
Demographic segmentation is the most common approach. This can include
information on consumers related to gender, age, religion, income, occupation,
education level, marital status and life-cycle stage. All demographic variables are
potentially important, especially when considering an individual’s life-cycle.
Traditional life-cycle stages include single people, married couples with and
without children, ‘DINKs’ (dual income, no kids), ‘empty nesters’ and elderly
singles. However, single parents, older childless couples and young families
increasingly are representing alternative stages in the life-cycle. The life-cycle
stage has considerable impact on the amount of time and financial resources that
can be devoted to sport consumption. Stages in the life-cycle directly affect
consumer behaviour, and it is essential for sport marketers to provide mechanisms
that encourage customers to remain loyal from childhood to the senior years.
Geographic segmentation
Geographic segmentation involves where the consumer is located in relation to
where the sport product is purchased and used. This approach can include
information on location (e.g., country, region, state, city), urbanicity (density of
city, suburban or rural area), culture (religion, language, food, social behaviour
and norms) and climate (season, tropical, dry, mountain, desert, mild, cold).
While it may appear safe to assume that spectator expectations in country and
regional areas are quite different from expectations in the city, even cities cannot
be treated as homogeneous for the sport marketer. While ease of event access,
parking and travel time are often important to the suburban commuter, public
transport and additional entertainment possibilities may be far more important to
the inner-city dweller.

Psychographic segmentation
Psychographics segmentation is largely based on attitudes, opinions and interests
of consumers. As a result, they can be more difficult to measure and quantify.
This approach attempts to explain consumer behaviour in terms of needs satisfied
from a sport product. For example, strategies to differentiate gym clients can be a
‘fitness-driven’ segment motivated exclusively by fitness reasons such as
competition, achievement and skill mastery versus the ‘health-conscious social’
segment seeking activities that are healthy and that provide more social
facilitation. As a result, psychographic segmentation can utilise motives such as
SPEED – socialisation, performance, entertainment, esteem and diversion –
highlighted in Chapter 3. Consumers can also be segmented based on positive or
negative evaluations of features associated with a sport product. For sport teams
and leagues this could be a star player, head coach, success, logo design, venue
atmosphere, community pride, identification, excitement, competitive balance
and rivalry (Gladden & Funk, 2002; Kunkel et al., 2013). Psychographic
segments can also be derived from a consumer’s personality characteristics, such
as an individual’s desire for risk-taking, novelty-seeking, aggression,
compulsiveness, social awareness and optimism.

Behavioural segmentation
Behavioural segmentation refers to patterns of buying and using behaviour that
reflect how consumers interact with a product and related brands. It also provides
insight on the reasons for such behaviour. Beyond using simple frequency of
behaviour, this approach can utilise demographic, geographic and psychographic
information to inform segments. Six common behavioural segmentation methods
are usage rate, purchasing behaviour, occasion- or timing-based, user status,
benefits sought and customer journey stage. For each segment method a short
description is provided.

1. Usage rate: How often, how much, and how are customers using your
product. These can be broken down into:
a. Heavy users: the most reliable customers, providing the bulk of
consumer-generated revenue.
b. Mid-level users: customers who make and use purchases but not at
frequently.
c. Light users: one-off customers who are infrequent users.
d. Non-users: customers who either don’t know about the product or
choose not to purchase or use it.
2. Purchasing behaviour: How customers behave differently throughout the
path to a purchase. These can be broken down into:
a. Complex: customers highly involved in the decision-making process,
with a significant difference between product and related brands being
considered.
b. Variety-seeking: customers who are not very involved in the decision-
making process, but a significant difference exists between the product
being offered by different brands.
c. Habitual: customers who put minimal effort into decision-making, and
the product being offered doesn’t vary much from brand to brand.
3. Occasion- or timing-based: When customers are most likely to make a
purchase or use a product. These can be broken down into:
a. Universal: the majority of customers within a certain demographic or
geographic segment.
b. Regular-personal: customers that purchase and use according to factors
in their personal life.
c. Rare-personal: customers who are inconsistent and not necessarily
trackable or predictable.
4. User status: How different customers are classified by their relationship to
an organisation. These can be broken down into:
a. Non-users: customers who are unaware they have a problem and need a
product.
b. Prospects: customers who learn why choosing one product or related
brand is a better option.
c. First-time users: customers who require further instruction on how to
optimise their use of a product.
d. Regular users: customers who benefit from being introduced to
supplemental products offer that could help them attain their goals.
 5. Benefits sought: These are the primary benefits different customers seek
during a purchase or usage decision. These can be broken down into:
a. Benefits sought for those consumers who ended up purchasing versus
those who did not purchase.
b. Benefits most and least important to the most loyal customers.
c. Benefits most and least important to low lifetime-value customers or
those who discontinue purchasing.
6. Customer journey stage: The stage of the journey that new or existing
customers are currently in. These can be broken down into:
a. Awareness: customers who become familiar with a product and related
brands through various channels, including advertising, social media
and word of mouth.
b. Consideration: customers who realise that a need is not currently being
met and actively consider whether or not to buy a product on offer.
c. Purchase: consumers purchasing or using the product.
d. Retention: customers using the product and seeking guidance from
other consumers or the product provider.
e. Advocacy: customers spreading the word about the product – whether
their opinion is positive or negative.

The purchase of sporting equipment and apparel can be segmented according to

benefits sought. For example, an athlete may buy an electrolyte-replacement
drink not because they are thirsty or like the taste but because they believe that it
will replace essential elements the body has lost during intensive exercise. Hence
the athlete is purchasing the benefit – a more rapid recovery – rather than the
product – a sport drink. Another example of benefit segmentation in sport
purchasing relates to the potential benefits of athletic footwear. Some individuals
will purchase a running shoe because it offers a wide toe box, controls supination
and provides arch support and stability. Others will purchase the same shoe
because it looks fashionable, glows in the dark and a celebrity sport start wears
the same shoe.
There are a number of advantages of using a behavioural segmentation
method. For example, sport marketers can analyse historical patterns of behaviour
in order to predict future behaviour. This allows for targeting different consumer
segments with different offerings to influence using and buying behaviour as well
as make decisions on how to best allocate resources. Sportview 4.1 provides an
overview of effective behavioural segmentation in the mobile gaming context.

SPORTVIEW 4.1
Market segmentation: mobile games
Mobile gaming is one of the most successful gaming industries, and relies on
behavioural segmentation. There are multiple game genres – action, puzzle,
sports, strategy, etc. – all of which utilise the freemium model of revenue
generation. The freemium model allows mobile game consumers to play the
game for free, thereby providing multiple restricted in-game features for a price.
Freemium strategies entail giving a game away and then charging players small
fees or ‘microtransactions’ to access additional or restricted game content.
Therefore, a mobile game such as Candy Crush Saga allows its consumers to
play for free but provides paid-for assistance (like extra lives) to enhance the
overall experience of the game. The free aspect of the game is monetised
through advertising, whereas the premium aspect generates in-game purchase
revenues. For a mobile game to monetise both these aspects of a freemium
mobile game it behaviourally segments its consumers based on their
engagement levels. Such a form of segmentation helps mobile game
organisations increase their consumers’ level of engagement by providing them
with personalised experiences based on their advancement/position in the game.
Behavioural segmentation allows practitioners to understand the time spent
by consumers in the game by categorising them as light users, medium user and
heavy users. Such a form of segmentation provides insights into each consumer
segment’s gameplay preferences, motivations and paying behaviours. By
identifying gameplay preferences and motivations for different segments of
consumers, mobile game organisations can prolong the consumers’ engagement
by creating different habits in the game. These habits can last throughout the
game’s life-cycle or may be limited to a certain time period. The past
behaviours of each of these consumer segments also provide insights into future
engagement behaviours in the game. For example, understanding the
behavioural patterns of heavy users helps mobile game organisations identify
potential users who at present may be light or medium users. One of the
techniques increasingly being adopted by mobile game organisations to segment
their customers based on their behaviour levels is Artificial Intelligence (AI) or
data-driven approaches. Through AI, mobile game organisations are able to
identify emerging engagement patterns of mobile game consumers that help the
system categorise them into one of the behavioural segments that can be
targeted in a personalised way. While such techniques make it easier for mobile
game organisations to cultivate habitual behaviour in their consumers, the onus
lies on these consumers to avoid harmful behaviours such as mobile game
addiction and negative social culture.
Data-driven segmentation
The data-driven segmentation strategy is largely atheoretical and exploratory, and
depends on a number of factors. This method uses information collected on
consumers to uncover new segments based on various analytic techniques. As
with some of the behavioural segmentation methods shown in Table 4.1, the
combination and analysis of demographic, psychographic, geographic and
behavioural information can be instructive for sport marketing professionals. For
example, Chapter 3 introduced the Psychological Continuum Model (PCM)
framework with four psychological connection stages of awareness, attraction,
attachment and allegiance. These four stages would be considered segments that
allow for consumers to be compared within and between stages using information
collected from other segmentation variables (Doyle et al., 2013; Funk et al.,
2011). As a result, new insight is gained and allows for customisation of products
to unique consumer groups.
Table 4.1 Sample Puma profile and persona
Profile

Gender: Female (67%)

Age: 25–35 (44%)
Marital Status: Single (72%)
Ethnicity: Oceanian (59%)
Education: Graduate degree (39%)
Income: $60,000–$85,500 per year (49%)
Resident: Melbourne (42%)
Leisure Preferences: fitness (65%), dining (88%), music (68%), clubs
(45%)
Social Media Use: Twitter (82%), Instagram (71%), Facebook (68%)
Retail Purchases: online (89%), discount department store (67%)
Clothing Preferences: contemporary (86%), athleisure (58%)

Persona
Susan is a 31-year-old single white female living in Carlton North, a suburb of
Melbourne. She graduated last year from Swinburne University of Technology
with a master’s degree and got a job in the financial sector making $75k a year.
Her schedule is hectic between work and social time. In her free time, she likes
to do yoga and group fitness classes, go to concerts, and spend time hanging out
with friends at bars and restaurants. She spends time following Twitter and
Instagram to keep up with news, college friends and entertainment offerings.
She loves to shop online at The ICONIC or at the mall in David Jones. Susan
and her friends usually go downtown to clubs to listen to pop music and dance
on the weekends. She likes to look stylish both at work and in her leisure time,
therefore she is looking for a clothing brand that is versatile and makes her feel
like she wants to be.

Segmentation profile and persona

The segmentation process allows sport marketers to develop profiles and
personas. A segmentation profile can be developed for each segment based on
known facts or data. A profile is largely data-driven using percentages, averages
and comparative analytic techniques of quantitative data. A segmentation persona
is derived from the profile and attempts to illuminate specific details that describe
a prototypical consumer from a segment. This is often a character-building story
that describes goals, motivations, behaviours, habits, likes and experiences of
buying or using the sport product as well as other consumer products. A persona
is often built from both quantitative and qualitative data. Table 4.1 provides an
example of a profile and persona for Puma.
As Susan’s profile and persona illustrate, identifying a consumer segment is an
effective marketing strategy. Whether conceptual or data-driven, information
collected on demographic, psychographic, geographic and behavioural
characteristics is important for the segmentation process. Therefore segmentation
strategies basically provide the ability to customise the marketing mix to keep
pace with the shifting demand for sport products. The inclusion of segment
method data in the establishment and maintenance of a MIS will help sporting
organisations become increasingly discerning and creative in their target market-
segmentation approaches. When we decide that a particular market segment will
be the focus, we have selected a target market.

Target market selection

The selection of the appropriate target market follows the process of
segmentation. Having identified the segmentation variables, the next step is to
determine the optimal number of segments. In general market segments must be
substantial enough to justify investing financial resources – such as size,
reachability and receptiveness – and provide differentiation from other segments.
When these criteria are fulfilled, the sport marketer can assess the segment’s size
and growth potential, its attractiveness and whether the segment offers scope to
achieve the organisation’s strategic objectives and generate vital resources. Based
on this information, the sport marketer is in a position to select one or more target
markets. Target market-selection strategies include the selection of: a single
segment; a number of unrelated segments; a number of segments that are selected
on the ability of the sport organisation to deliver a particular product; a number of
segments that are based on the ability of the sport organisation to serve a
particular market very well (for example, the Melbourne metropolitan AFL
market); or a full market coverage strategy, targeting the market as a whole.
The growth of esports serves as an interesting example for understanding
segmentation. Esports, competitive video gaming tournaments and competitions,
have a large and global fan base of over 500 million. Most of these consumers are
watchers and/or players and come from the lucrative yet difficult to reach
generation of digital natives. Digital natives are individuals who grew up
surrounded by technology and are more accustomed to using it. Esports players
tend to be younger and male, while watchers tend to be male and female and
slightly older. A multiplicity of terms has been used to describe digital natives
(e.g., Millennials, Generation Z), but their superior technology skills make them
different from prior generations. With their familiarity with technology, digital
natives have grown up in an environment where video gaming and supporting
technology are commonplace.
Companies such as Riot Games, Activision Blizzard, Electronic Arts (EA),
Valve and Epic Games are among the leading video game producers. These
publishers have focused on incorporating competitive video game play elements
into their titles to broaden their appeal to multiple consumer segments. Major
titles (or games) from these publishers include League of Legends (Riot Games),
Overwatch (Blizzard), the FIFA and Madden NFL franchises (EA), Dota 2
(Valve) and Fortnite (Epic Games). With the market for video gaming expanding,
so has a desire to position various game titles to attract multiple segments.

Positioning
The final piece in utilising a marketing information system is the identification of
positioning strategies for segments. This involves customisation of the marketing
mix for selected target markets. In this process it is important to remember that
the key to successful positioning lies in the sport marketer’s ability to
differentiate the product offering from segment competitors. For example,
whatever is different in the offering of the sport organisation needs to be
important and distinctive for alternative products and related brands. Positioning
can focus on bundling benefits that consumers seek in consuming the product;
quality or price can be used to set the offering apart from others; or the image of
the product or organisation can sway consumers to purchase a trendy ‘brand’
rather than a non-branded product.
 Companies that provide products to a broad spectrum of consumers often
target sport. Hence sport consumers represent a diverse but identifiable segment
within the general population among which to customise the marketing mix. Soft
drinks, fast food, telecommunications, mobile devices, insurance and banking are
examples of products that are omnipresent in the sports environment.
Furthermore, codes, teams, athletes and social influencers are often used to
promote various products.
Ries and Trout (1986) suggest that ‘the basic approach of positioning is not to
create something new and different, but to manipulate what’s already in the mind’
(p. 5). In other words, positioning is really about what the marketer does in the
mind of the consumer. In reality, there are probably two ways in which sport can
be positioned in the mind of the consumer. As Ries and Trout indicate, the best
option is to be first; but if you can’t be first, be different. When it comes to sport,
marketers and promoters constantly try to effectively position their product in the
mind of an increasingly discerning consumer. Furthermore, given that consumer
preferences are in a constant state of flux, the positioning process demands
creativity and responsiveness.
Given that the sport marketplace is so dynamic and constantly in a state of
change, sport marketers must not only recognise change, but must also be
strategically ready to respond to it quickly. Moreover, the speed at which change
occurs will only increase in the future, and sporting organisations, already
sensitive to market share, will need to be increasingly creative in their
segmentation strategy. Defining product position and its application is considered
in more detail in Chapter 5.
The current need for ongoing information and increasingly sophisticated
marketing information systems is the result of a dynamic, constantly changing
sport marketplace. With less time for deliberation, increased accountability,
growing and changing consumer expectations, financial cost and the ever-
expanding scope of marketing activities, sporting organisations need rapid access
to reliable information that will result in clear, appropriate decision-making.
Fortunately for sport organisations and managers, the quantity and quality of
available information are constantly expanding.

Summary
Sport market research and strategy consists of activities designed to collect
information to make informed decisions. A marketing information system (MIS)
that utilises Internal Data and Reports, Market Intelligence, Analytics Software
and Market Research is essential for the adaptation of an organisation to a volatile
and changing sport marketplace. The major sources of information for a MIS
include ongoing activities to collect both internal and external data. Such data can
be collected by the sporting organisation or an external agency.
Market research in sporting organisations seeks to answer the questions of
who, when, where, what, how and why consumers are buying and using a sport
product. These questions can be answered by collecting information from internal
organisational data sources and from external sources that address both general
and specific sport market conditions and competitors. A beneficial approach to
address a specific problem or project is to design and implement research on
consumers to gain insight through qualitative and quantitative methods. Such
research can also allow the sport marketer to divide customers into meaningful
segments to target on the basis of demographic, geographic, psychographic and
behavioural characteristics to create profiles and personas. Finally, it should be
remembered that the sport marketplace is in a constant state of change. Sport
marketers must determine how to present a product to various consumer segments
in order to place themselves in a position to not just respond to change but even to
anticipate it.

CASE STUDY
The positioning and challenges of an underdog league brand: the
case of the A-League
Thilo Kunkel

Background
The Australian market is a very competitive sport consumer market. Four
football codes, each represented by a league – Australian Rules football (AFL),
football/soccer (A-League), rugby league (NRL) and rugby union (Super 15) –
compete with each other for consumers. Hence proper league brand positioning
is crucial for the competitiveness of the league. While the AFL, NRL and Super
Rugby are established leagues, the A-League was introduced in 2005 as a
successor of the defunct National Soccer League (NSL). In the NSL, supporting
a team was determined by nationality and ethnicity. These ethnic links limited
the appeal of the NSL to an audience without ethnic backgrounds, which
initiated the rebranding and repositioning of the league so it could compete with
the AFL, NRL and Super Rugby.

Positioning
Football/soccer underwent drastic repositioning in 2004. The positioning
strategy was to rebrand soccer as football to eliminate the ethnic connections
associated with soccer in Australia and to appeal to a broad Australian audience.
The governing body of all levels of football, the Australian Soccer Association
(ASA), was renamed Football Federation Australia (FFA) and the A-League
replaced the NSL. The first marketing campaign used the slogan ‘Football, but
not as you know it’, highlighting the shift towards the global game of football.
The A-League started as an eight-team competition based on one team per city
to leverage fans’ involvement with their home city.

Initial success and expansion

In the first three seasons the A-League was successful in generating solid
attendance figures. Average attendances increased from 10,956 in the 2005–06
season to 14,608 in the 2007–08 season. This was accompanied by a noticeable
shift in the fan culture, which was no longer related to the ethnic roots of the
teams. These early successes led to a decision to expand the league. The A-
League grew with the addition of Gold Coast United and the North Queensland
Fury in the 2009–10 season. While this expansion strategy extended the
league’s reach, average attendance figures fell to an all-time low of 8393 in the
2010–11 season.

Decline of the league

Two main factors contributed to the fall in average attendance figures of the A-
League. First, the new teams were situated in markets that were not ideal for
expansion. North Queensland Fury was based in Townsville, which has a
population of under 200,000 potential fans and a reputation as an ‘NRL town’.
Similarly, Gold Coast United was based in an ‘NRL town’ with a reputation for
being a ‘graveyard’ for professional sport teams because the Gold Coast has
numerous attractions, such as beaches, mountains and theme parks. Second,
FFA focused its attention on bidding for the FIFA World Cup 2018/22, and
neglected the A-League. The governing body invested heavily (money and
time) in developing a competitive bid to host the World Cup in Australia
therefore resources were not available to promote the A-League and the teams.

Rationalisation of the league

As a result of the decline of the A-League, teams were struggling with financial
instability and some team owners were not able to cover the costs. FFA took
over the licence of North Queensland Fury and financially supported five other
teams. However, at the end of the 2010–11 season, FFA decided to revoke the
Fury’s licence because it needed to redirect resources to invest in league-wide
marketing and promotions and could not justify the team’s existence at the
expense of other teams. Similarly, at the end of the 2011–12 season FFA
decided to revoke the licence of Gold Coast United because the club did not act
in accordance to its franchise contract when it decided to close parts of its
stadium to reduce costs. Considering that leagues and teams are connected
through their brand architecture (Kunkel et al., 2013), revoking the licences of
these two teams alienated fans of the league in both the Townsville and Gold
Coast geographic areas. Furthermore, it was an indication of the instability of
the league, and reflected negatively on the brand image of the league.
Therefore, the A-League needed to counter this downwards trend.

Market research, consumer segmentation and league recovery

After the failed bid to host the FIFA World Cup 2018/22, FFA turned its focus
back towards the A-League in two main areas. First, it conducted market
research and gathered primary data through online surveys. A link was placed
on the league’s official web page inviting visitors to the site to participate in
research and provide feedback. Based on the research findings, consumers were
segmented and FFA decided to focus its A-League marketing efforts on one
specific consumer segment: a core group of males aged 18–34 who were
classified as avid fans of the sport of football. To attract this market segment,
the league launched a marketing campaign with the slogan ‘We are football’,
focusing on fans and their connection to the sport to promote positive brand
associations to consumers (Kunkel et al., 2014).
Second, FFA collected internal primary data through Australia-wide football
club memberships and external secondary data from television stations and the
ABS to guide strategic expansion decisions. Data indicated that Melbourne and
Sydney were most suitable for expansion because these two cities are
Australia’s two biggest consumer markets, and both have a high percentage of
individuals who emigrated from parts of the world where football is the most-
followed sport. Consequently, FFA expanded the A-League with Melbourne
Heart (now Melbourne City) and Western Sydney Wanderers in these two
markets. Additionally, the A-League increased its media exposure, especially
through social media sites, to adhere to fans’ requests for more access to
information. As a result, the A-League began to recover, with average
attendances at games increasing to 12,321 during the 2012–13 season.

Lessons learned from this case

 There are three main lessons that can be learned from the case of the A-League.
First, sport brand positioning needs to be implemented strategically. The
positioning of the league brand to align with the global game of football helped
overcome negative aspects associated with the league. Second, sport brand
positioning and marketing need to consider the target market and develop
customised marketing towards core target market segments. To identify these
core segments, market research from many different sources is necessary. Third,
sport brand positioning needs to have a long-term focus. Key decisions that
have a strong influence on fans – such as league expansions – need to be made
with an understanding of fan behaviour and a long-term vision of how the sport
is positioned in mind.

Additional source: All attendance figures were calculated based on

information from www.ultimatealeague.com.

Questions
1. Describe how market research helped the A-League recover.
2. Identify the data-collection methods used by FFA.
3. Identify three other methods of data collection FFA could have employed
to develop consumer segments.
4. If you were the marketing manager of the A-League, which consumer
segment would you target?

References
Doyle, J., Kunkel, T., & Funk, D.C. (2013). Sport spectator segmentation:
Examining the differing psychological connections among spectators of
leagues and teams. International Journal of Sport Management and
Sponsorship, 14(2), 95–111.
Filo, K., & Funk, D.C. (2005). Congruence between attractive product
features and virtual content delivery for internet marketing communication.
Sport Marketing Quarterly, 14, 112–122.
Funk, D.C., & Pritchard, M. (2006). Sport publicity: Commitment’s
moderation of message effects. Journal of Business Research, 59, 613–621.
Funk, D.C., Beaton, A.A., & Pritchard, M. (2011). The stage-based
development of physically active leisure: A recreational golf context.
Journal of Leisure Research, 43, 268–269.
Funk, D.C., Pizzo, A.D., & Baker, B.J. (2018). eSport management:
Embracing eSport education and research opportunities. Sport Management
Review, 21, 7–13.
Gladden, J.M., & Funk, D.C. (2002). Developing and understanding of
brand association in team sport: Empirical evidence from professional sport
consumers. Journal of Sport Management, 16, 54–81.
Kunkel, T., Funk, D.C., & Hill, B. (2013). Brand architecture, drivers of
consumer involvement, and brand loyalty with professional sport leagues
and teams. Journal of Sport Management, 27, 177–192.
Kunkel, T., Funk, D.C., & King, C. (2014). Developing a conceptual
understanding of consumer-based league brand associations. Journal of
Sport Management, 28, 49–67.
Mullin, B.J., Hardy, S., & Sutton, W.A. (2000). Sport marketing (2nd edn).
Human Kinetics, Champaign, IL.
Pizzo, A.D., Baker, B.J., Na, S., Lee, M., Kim, D., & Funk, D.C. (2018).
eSport vs sport: A comparison of spectator motives. Sport Marketing
Quarterly, 27(2), 108–123.
Ries, A, & Trout, J. (1986). Positioning: The battle for your mind, Warner,
New York.
Stanton, W.J., Miller, K.E., & Layton, R. (1995). Fundamentals of marketing
(3rd edn). McGraw-Hill, Sydney.
Part III
Strategy determination

DOI: 10.4324/9781003270522-7

CHAPTER 5
Sport brands and products
CHAPTER 6
Sport and pricing strategies
CHAPTER 7
The sport place
CHAPTER 8
Sport and media distribution
CHAPTER 9
Sport promotion
CHAPTER 10
Sport services: service quality and satisfaction
CHAPTER 11
Sport sponsorship
CHAPTER 5

Sport brands and products

DOI: 10.4324/9781003270522-8

Chapter objectives
Chapter 5 introduces the first variable in the marketing mix: the sport
product. The chapter is the first detailing Stage 2 of the strategic sport-
marketing planning process (SSMPP): strategy determination. During this stage,
marketing mix variables are reviewed and combined in such a way as to
determine the core marketing strategy. The importance of identifying and
understanding the product and its attributes is articulated, and the
conceptualisation of sport brands, and the role of brands, is highlighted. Key
tools to assist in determining the core marketing strategy are introduced,
including the product life-cycle.
After studying this chapter, you should be able to:

identify the difference between core and product extensions in sport

describe the characteristics of a service
understand why sport is classified as a service product
understand the strategic significance of the product life-cycle
identify the role of branding and licensing to the sport product.

Headline story
The coolest game in Russia
Global football is the most popular sport in Russia, but ice hockey is a close
second, especially given the frigid temperatures in parts of the country. In 2008,
the Russian Superleague reorganised to become the Kontinental Hockey League
(KHL), occupying an important space in the Russian sport landscape. As former
President of the KHL Dmitry Chernyshenko explained, ice hockey has been
woven into the Russian ethos alongside cultural staples like vodka and caviar.
Naturally, one of the concerns from KHL athletes, media and sponsors was the
possible competition with the premier ice hockey league in the world, the
National Hockey League (NHL). However, the KHL has never viewed itself as
a direct competitor, instead choosing to focus on its distinctive product offering
to the market: embracing technology and analytics, expansion outside of Russia
and instituting a hard salary cap for competitive balance (Szporer, 2019).
While the NHL might have a significant North American following for ice
hockey, the KHL has focused on developing a different product and brand, not a
competing one. KHL teams have real-time access to player data, including
player and shot speeds, and time on ice, which also considerably enhances the
fan viewing experience. Unlike the NHL, which only operates in two countries
(the USA and Canada), the KHL operates in six: Belarus, China, Finland,
Kazakhstan, Latvia and Russia. Finally, while the NHL’s salary cap continues to
rise, the KHL’s has remained low, increasing parity between teams. These
 features have allowed the KHL to prosper despite there being another, more
well-known ice hockey league in existence.

The KHL story provides an introduction to this chapter, which focuses on the
sport product. While it might be good for the KHL to offer a product extremely
similar to the NHL, restricting real-time statistics integration, consolidating play
to just one or two countries and allowing for rising salary caps, it is unclear how
that strategy would benefit the ice hockey product in Russia. Shifting towards an
NHL-type model could have some benefits, but it might call into question the
longer-term viability of the KHL in Russia and other affiliated countries. If both
leagues were similar in their offering and value proposition, consumers might
simply opt for the league with the best players – which, to this day, remains the
NHL. There is also a more pressing domestic issue: television rights. If both KHL
and NHL products were similar, European and Asian sports media might not be
inclined to bid for KHL rights given the star power and demand of the NHL
product. Thus, the example of the KHL lends credence to the importance of the
sport product, knowing what you can offer and how it may differ from products
that are already present in the market.
The purpose of this chapter is to examine the place of the sport product in the
marketing mix, and illustrate the importance of service provision of the sport
product. As can be seen from the Headline Story, the sport product comes in
many sizes, shapes and configurations, complicating the capacity to apply
standard solutions.

The sport product

In order to understand the sport product, let’s begin with a general definition and
overview of a product. Armstrong et al. (2018, p. 200) described a product as
being ‘anything that can be offered to a market for attention, acquisition, use or
consumption that might satisfy a want or a need’. In this spirit, products may span
a range of goods, services, ideas, people, places and activity characteristics. With
such variance in the market, the selection of one product over another is often
determined by the ability to satisfy the consumer’s needs or requirements, or by
the product’s ‘quality’ (Perreault et al., 2013). Product quality can vary depending
on the consumer’s view and perceptions, but quality is often associated with a
product’s benefits. Products may be considered ‘problem solvers’ in that they are
consumed because of the benefits they may provide. Essentially, consumers buy
benefits, not products.
 In sport, the product is easily discernible. For one, there are the ‘physical
hardgoods’ that are used for sport and recreation. Bats, balls, protective gear,
cleats/spikes and uniforms are all types of products used in sport that require
appropriate marketing. In certain situations, the sport marketer might have the
ability to discuss new equipment features or evolutions, making their job easier.
However, the quality of the core sport product, the game itself, is something over
which the sport marketer has no control. This is a distinctly unique aspect of sport
and sport marketing. While a marketer in a non-sport enterprise may be able to
work in tandem with management and the supply chain to affect the core product
offering, sport marketers are subject to product inconsistency. For example, tennis
tournaments like the Australian Open have significant notoriety for world-class
athletes agreeing to compete at the event. However, once those players enter the
court, there is little organisers and marketers can do to ensure quality matches.
Even matches receiving ‘top billing’, such as a Nadal vs Djokovic or Andreescu
vs Kerber, do not always guarantee quality contests. However, while the core
product might be uncontrollable, the quality of supporting product extensions can
be guaranteed. Product extensions are those activities that are related to the core
sport product, such as food and beverages, merchandise, half-time entertainment
and video screen signage (Mullin, 2000). Quality product extensions often bleed
into perceived quality for the core product, making the former a critical element
in sport marketing. As a consequence, even though the Andreescu vs Kerber
tennis match might not be as great from a core sport perspective, the product
extensions at the Australian Open can ensure that spectators have an enjoyable
experience.
The lack of control over the core sport product is difficult to reconcile for sport
marketers as winning and exciting action are often viewed as critical ingredients
in a sport setting. However, when thinking not just of the core sport product but
also of its affiliated extensions, there is greater scope for marketers to control and
manipulate as they seek to provide benefits to consumers. In this respect, sport
can be conceptualised as a service.

Sport as a service
A common theme among authors writing about sport marketing (Mullin, 1980,
1985a, 1985b; Mullin et al., 2014; Shilbury, 1989, 1991) has been their agreement
about how the unique characteristics of sport require marketing personnel to
adopt different strategies from those traditionally espoused. This is a critical point
in the difference between marketing in other industries and sport specifically.
While many of these works have been devoid of specific references to service
marketing, the discussions pertaining to these unique characteristics align sport
with the attributes of a service.
Zeithaml et al. (2017) presented four key features that distinguish goods from
services that are also useful in conceptualising sport as a service:

Intangibility. Services cannot be seen, tasted, felt or smelled before they are
bought. Services are performances rather than objects. For example, is it
possible to describe what product benefits people take home with them after
playing sport? Or the benefits derived from watching a baseball game?
There is no tangible take-home product in this example.
Simultaneous production and consumption. Services are simultaneously
produced and consumed. The product cannot be put on the shelf and bought
by the consumer. The consumer must be present during production – for
example, attending a sporting contest. You cannot stop and come back to the
product later on as you would with goods; you need to attend during the
process.
Heterogeneity. Services are potentially variable in their performance.
Services can vary greatly depending on who performs them. Many different
employees can come into contact with the consumer; therefore, consistency
becomes an issue. Few sporting contests are the same from one week to the
next, and the consistency of service delivery by people working at sport
events can also vary.
Perishability. Services cannot be stored. Hotel rooms not occupied, airline
seats not purchased or tickets to a sporting contest not sold cannot be
reclaimed. They represent lost revenue, indicating the importance of
understanding that services are time-dependent.

Perhaps the most significant difference between a good and a service is the
simultaneous production and consumption element. A service, then, is
predominantly any activity or benefit that is intangible and does not result in
ownership. Both spectators and participants take from the game a series of
experiences, none of which is physically tangible. Students of sport marketing
should be careful not to confuse some of the tangible products that can be bought
as a consequence of the game or sport (product extensions) with the game or sport
itself (core product). Without the sport, the merchandise would not exist.

Classification of services
When classifying services, we need to determine the extent to which the customer
must be present. To assist in making this determination, Wirtz and Lovelock
(2016) use a four-way classification scheme involving:

tangible actions directed at people’s bodies

tangible actions directed at goods and other physical possessions
intangible actions directed at people’s minds, and
intangible actions directed at intangible assets.

Table 5.1 illustrates Wirtz and Lovelock’s (2016) schematic with examples.
Considering the classification used in Table 5.1, where would sport be placed?
This is an interesting question as the answer might depend on whether we are
being specific about physical participation or attendance. Physical participation
could be classified as a people-based service directed at people’s bodies.
Attendance at sporting events could more accurately be classified as a people-
based service directed at people’s minds (and their hearts). The context of
participation in sport is important in framing marketing strategies. The most
obvious example is the formation of marketing strategies aimed at attracting
players to participate in a competition or sport, and the marketing strategies
required to attract people to attend a sporting event. In either case, it is necessary
to ask why such a classification scheme is important. This question can also be
answered using the work of Wirtz and Lovelock (2016):
Table 5.1 The nature of services
What is the nature of Who or what is the direct recipient of the service?
the service act? People Possessions
Services directed at Services directed at goods and
people’s bodies other physical possessions
Health care Freight transportation
Passenger
Industrial equipment repair
Tangible actions transportation
Beauty salons Janitorial services
Exercise clinics Laundry and dry cleaning
Restaurants Landscaping/lawncare
Haircutting Veterinary care
Intangible actions Services directed at Services directed at intangible
people’s minds assets
Education Banking
Broadcasting Legal services
 What is the nature of Who or what is the direct recipient of the service?
the service act? People Possessions
Information services Accounting
Theatres Securities
Museums Insurance
Source: Lovelock (1991, p. 26). Reprinted with the permission of Prentice Hall,
Inc., Upper Saddle River, NJ.

1. Does the customer need to be physically present: (a) throughout the service;
(b) only to initiate or terminate the service transaction; or (c) not at all?
2. Does the customer need to be mentally present during service delivery? Can
mental presence be maintained across physical distances via mail or
electronic communications?
3. In what way is the target of the service act ‘modified’ by receipt of the
service, and how does the customer benefit from these ‘modifications’?

If, as is the case in sport, customers need to be present to play or watch a live
event, they must enter the service factory, returning us to the importance of
simultaneous production and consumption: when spectators or participants enter
the ‘sport factory’, otherwise known as the sport facility. The major implication
of the consumer entering the sport factory or facility is that sport spectatorship in
particular is a service experience.
In sport, it is hard to overcome the winning (I had a good day/night) or losing
(I had a bad day/night) syndrome. Although this special range of emotions will
never be removed from the sport product, their importance can be diminished by
ensuring that the overall product is very good. To do so requires organisations and
marketers to look introspectively when they are developing their product from the
outset.

Product development
It is also important for marketers to recognise how the product they are dealing
with develops and changes over time so they can strategically adapt (Armstrong
et al., 2018). Every product, including sport products, experience what is known
as the product life-cycle (PLC). Typically, a life-cycle involves some form of
birth or inception of the product, a period of growth and maturation, followed by
death, usurped by new and improved products that satisfy the needs of
consumers. There are some differences specific to the sport product, however. In
general, it is unusual for a sport product to die completely. It is possible to trace
the history of many sports worldwide and note how the majority have stood the
test of time (e.g., ice hockey, basketball, American football). However, while
some sports are not successful, they continue to exist and have varying levels of
success. Instead of a sport completely disappearing, competitions, events,
tournaments and clubs/teams tend to disappear or require marketing strategies
designed to extend their own life-cycles. Relocation of teams, rule changes,
mergers and the provision of new facilities all constitute ways in which various
forms of the sport product endeavour to avoid decline. The other major difference
is that sporting organisations do not release new products often, unlike the car and
computer industries do. Whereas those industries are subject to large shifts in
consumer attitudes and technological innovations necessitating new products on
an annual basis, the sport product is reasonably stable and does not experience as
many radical changes (Slack & Parent, 2006).
Figure 5.1 illustrates the product life-cycle. The typical PLC curve is S-shaped
and characterised by four phases:

Figure 5.1 Product life-cycle.

1. Introduction is a period of slow sales growth. Profits are non-existent at this

stage because of the heavy expenses of introducing the product to the
market.
 2. Growth is a period of rapid market acceptance and increasing profits.
3. Maturity is a slow period of sales growth because the product has been
accepted by most potential buyers. Profits stabilise or decline because of
increased marketing designed to defend the product against competition.
4. Decline is the period when sales show a strong downward drift and profits
erode.

To further investigate how the PLC manifests with the sport product specifically,
let’s dissect each stage using the Australian National Basketball League (NBL) as
a contextual backdrop.

Introduction
The introductory stage is characterised by the need to communicate the existence
of the product to potential consumers. This can be very expensive, and accounts
for the high start-up costs for a new product. The principal objective in this stage
is to build awareness. This was also the primary objective for organisers of the
NBL. As the league was only formed in 1979 and basketball was not a traditional
Australian sport, it was challenging to obtain a significant market share. As a
result, sport products in their introductory stage typically experience low or
negative profitability, with very limited (near zero) sales. Attracting 190,000
spectators in the first year of the NBL competition, compared with just over a
million in 1995, illustrates the initial difficulties of developing basketball in
Australia.

Growth
As the product gains recognition and is embraced by consumers in the market, it
is said to be in its growth period. As awareness began to build for basketball in
Australia, so, too, did its profitability. NBL attendances grew to 242,022 by 1984,
to just over 800,000 by 1990 and to over 1 million in 1995. In this period,
considerable growth was achieved as many clubs moved to larger playing
facilities. During the growth stage, the range of product offerings tends to widen,
and refinements are made to the way in which the product is offered. The NBL
found it necessary to provide large, comfort-focused facilities, as well as quality
product extensions. It was through product extensions that the NBL made its
greatest change to product offerings. Merchandise and licensing programmes
emerged, associated television programming appeared, and basketball began to
open up new market segments. To overcome the high cost of enticing new
consumers to NBL games, clubs began to recognise the importance of retaining
their members and loyal supporters.
Maturity
The maturity stage is characterised by a plateau in sales – in the NBL’s case, sales
in the form of attendance, memberships, sponsorships and merchandise. As has
already been discussed in this section, action needs to be taken to extend the PLC.
For the NBL, attendance figures were peaking in the mid-1990s with roughly 80
per cent of stadium capacity. Additionally, sponsors’ interest was levelling off,
and television ratings could be conceived as subpar. However, the maturation
phase also presents an opportunity for marketers and organisers to revitalise the
product. The NBL also experienced this feature, contemplating a shift to its
competition schedule to be more favourable to broadcasters and move it out of
direct competition with high-profile Australian sports like football and rugby
league.

Decline
The final stage of the PLC is reached when a product suffers such a drop that the
product becomes ostensibly obsolete. As previously mentioned, this is not a phase
that is a frequent occurrence in sport, but it is possible. Thankfully for the NBL,
there has not been a significant period of time, mostly attributable to organisers
and marketers taking advantage of the revitalisation opportunity presented to
them. Today, the NBL has emerged as a highly popular sport product in Australia,
and has gained international renown with high-profile athletes like the US
National Basketball Association (NBA) star LaMelo Ball and ownership groups
such as former NBA executive Bryan Colangelo.

Variations from the PLC curve

The PLC is a useful tool for the sport marketer to assist in strategy development
for sports, and sporting leagues and associations. The S-curve indicated in Figure
5.1 can be misleading, however. Not all products progress incrementally through
the stages of the life-cycle described, making it harder to discern the stage of the
PLC at which a product can be classified. Another complication is the time taken
to progress through the stages of the PLC. It is very hard to predict how long it
will take a product to move from an introductory stage to maturity. Indeed, the
NBL has been caught in this situation of taking at least two years to identify
maturity, and a subsequent levelling off of interest.
Figure 5.2 illustrates some of the more common variations from the normal S-
curve shown in Figure 5.1. The first curve (a) shows a product that has a long
introduction stage because it is adopted slowly by consumers. The second curve
(b) illustrates products such as one-day cricket, which are rapidly accepted and
have a shorter introductory stage. The third curve (c) represents ‘fad’ products
that typically have a rapid rise and rapid fall. The fourth curve (d) shows a
product that has been frequently revitalised, going through stages of decline
followed by growth. The Olympic Games provide a good example of the fourth
curve as this event has ebbed and flowed in terms of growth and popularity over
the past 100 years. At present, the Olympic movement could be described as
being in a growth phase, although as recently as 1980, leading up to the 1984 Los
Angeles Summer Olympics, it was in a state of decline. Los Angeles proved to be
the catalyst that provided the necessary revitalisation for the Olympic movement
– though it appears to have plateaued once more with the 2016 Rio Summer
Games and the 2018 PyeongChang Winter Olympics.

Figure 5.2 Variations on the PLC S-curve.

Once a product is developed and experiences various stages of the PLC, it is the
responsibility of the sport marketer to enhance the viability and awareness of the
product. One way in which marketers can achieve this is through branding and
licensing. In this next section, we will look at these concepts in terms of where to
distribute the sport product, having a strong, well-defined brand to license
outward and generate revenue thereafter.

Branding
We can all identify with the practical application of the brand concept. Powerful
brands are immediately associated with the product or service they represent.
Coca-Cola is a soft drink, McDonald’s sells hamburgers, Manchester United is a
global football giant, and the Daytona 500 is a major motorsport event. But these
are not the only brands in their respective categories, so why do consumers
gravitate towards these brands? As de Chernatony et al. (2010) expressed, brands
seek ‘to create value and promise a unique, welcomed experience for the
consumer’ (p. 31). In this capacity, brands are a combination of the core product
and consumer perceptions about the product and the unique value provided.
Figure 5.2(a) shows what distinguishes a brand from the core product. In Figure
5.2(b), this is applied to a sport example.
In order to offer consumers those unique, welcomed experiences, firms must
engage in branding activities. Branding involves the use of a name and/or symbol
to identify a product (Perreault et al., 2013). Club Atlético Boca Juniors and Club
Atlético River Plate represent two global football (soccer) brands within the
Argentinean Primera División, and the Guyana Amazon Warriors and Barbados
Royals (formerly Tridents) represent brands in the Caribbean Premier League
(cricket). Brands are important to their owners/members as they help consumers
identify a company and its products. If brand recognition and acceptance are high,
the potential for high brand loyalty exists. In sport, it is through team and club
loyalty that prominent brand recognition is achieved. Typically, there are four
forms of brand development, the following two of which are more directly
relevant to the sport product:

Line extensions: existing brand names extended to new forms, sizes and
flavours of an existing product category; for example, Coca-Cola’s versions
of its soft drinks – regular, diet, caffeine, caffeine-free and Coke Zero. In
sport, Test cricket, one-day cricket and Twenty20 cricket, or indoor
volleyball and beach volleyball, could be considered line extensions.
Brand extensions: existing brand names extended to new product categories.
For example, Sony uses its company name to cover such different products
as televisions, DVD/Blu-ray players, cameras, laptop computers, radios,
Bluetooth audio and data projectors. In sport, league shops/retail fronts,
auction sites and travel agencies are all examples of brand extensions.

Branding, as the process of developing and sustaining successful brands, has

strategic relevance for the marketing function. The marketer tries to position the
brand ‘in the mind’ of the consumer. Consumers start perceiving the brand as the
symbolic total of the packaging, design, advertising, quality, price and store or
outlet where the product can be located and purchased. This total brand
perception enables the marketer to link mental visions to the organisation’s
branded products – expressing, for example, a lifestyle, a personality or a feeling.
Powerful brands differentiate themselves from similar products of competitors
and provide the opportunity to build long-term relationships with consumers,
developing brand-loyal buyers. By doing so, marketers develop equity in the
brand.
The concept of brand equity, according to Gladden et al. (1998), is the
combined tangible and intangible value of the brand, and can be broken down
into four constituents: perceived quality (of the brand); brand awareness (recall,
recognition); brand associations (in sport, often emotionally loaded); and brand
loyalty (the ability of the brand to retain customers). In the sport industry, the
antecedents to brand equity are team-related (e.g., success, star players),
organisation related (reputation and tradition, overall entertainment package,
service reputation), and market related (media coverage and reach, competitive
forces). Table 5.2 describes eight ways of using a brand in practice. Irrespective
of which usage is chosen from this list, adding value – as perceived by the
consumer – is the critical activity in the branding process. The marketer can use
the brand as a symbol of, for example, prestige, status, lifestyle or personality,
and can position the symbol in such a way that it expresses physical and
psychological comfort to the target market. However, sport marketers must also
make refinements and adjustments to the brand if there is limited equity and/or
the brand fails to provide that unique, welcoming experience for the consumer.
This important action is discussed in Sportview 5.1, with a focus on the Toronto
Raptors of the NBA. This Sportview raises the notion of ‘rebranding’ and what
choices are available to sport marketers.
Table 5.2 Brand use in practice
Usage of brand Why use it in that way
Brand as a sign of
Buyer knows which organisation produced the product
ownership
Brand as a
Buyer knows the product is different from comparable
differentiating
products
device
Brand as a
Buyer knows why and how to use the product
functional device
Brand as a
Brand communicates something about the buyer
symbolic device
Brand as a risk Brand communicates trust about the producer of the
reducer product
Brand as a Brand is a means to recall sufficient brand information
shorthand device from memory at a later purchasing time
Brand as a legal Trademark registration is legal protection from counterfeit
device production
Brand as a strategic Brand positioning is a means of ensuring a long-term
device future for the Organization
Source: Adjusted from de Chernatony & McDonald (1992).
SPORTVIEW 5.1
We the brand
It is not uncommon to walk along the concourse of a sport arena and witness
fans expressing their loyalty and dedication to the team by wearing clothing and
other apparel with the team’s logo prominently featured. Hats, T-shirts, jerseys,
shorts, socks and even shoes featuring team branding are all part of the tribal
element of sport; they evoke a sense of pride and passion, and shape the
personal identity of many people. For NBA teams like the Boston Celtics, the
Los Angeles Lakers and the Chicago Bulls, changing their branding would not
be top of mind. These brands have popular marques, attributable in part to their
longevity in the league and periods of success (e.g., winning championships,
star players), and cling to their equity derived from those logos and colours. But
for teams like the Toronto Raptors which have not been in the league as long as
the Celtics, the Lakers and the Bulls, and have experienced instability with
superstar talent, engaging in rebranding activities to ‘get it right’ with fans is
never out of the question.
The Raptors were born in 1994 with mixed reactions to their branding. With
several names to choose from, a fan vote resulted in the Raptors, co-opting the
popularity of the 1993 Hollywood film Jurassic Park; the team also sported a
purple, white and black colour scheme that the fan base was receptive to at first,
but eventually lamented. Sceptics compared the zoomorphic team branding to
‘Barney’, a reference to the popular American children’s show. With
unsuccessful seasons and the popularity of Jurassic Park waning, the
organisation began to tweak its branding, dropping the ‘childish’ purple in
favour of red. This initial rebranding was an important first step as it aligned the
team’s primary colours of red and white to the Canadian flag. The team also
began to shift its primary and secondary logos, shedding the Barney look for
more serious, aggressive dinosaur imagery (e.g., raptor claws).
Yet, despite the initial rebranding activities, there was still a cloud hanging
over the franchise. All-stars like Vince Carter and Chris Bosh came and went,
and the team had not had any meaningful success, with limited playoff
appearances and still no championships; the team was still unable to develop
significant equity in the brand. This all changed in 2014. The Raptors’ parent
organisation teamed up with hip-hop superstar Drake and creative marketing
agency Sid Lee to develop a new tagline to capture the tonality and vision for
the brand: ‘We The North’. As former team executive Tim Leiweke explained,
‘We The North’ captured the essence of the NBA’s only non-American
 organisation, a team that is often cast aside and viewed as insignificant (Zillgitt,
2014). The brand embraced this modern, urban ethos, adding a gold and black
Drake-themed scheme as well as a new logo that stood out among other NBA
logos for its use of negative space to display the Raptors’ claw.
This new rebrand has developed significant equity for the organisation. After
years of poor performance and negative attributions to the brand, the team has
grown its community of followers significantly (Naraine et al., 2021). It has
now become cool to wear Raptors apparel and identify as a fan of the brand in
the same way the Celtics, Lakers and Bulls have experienced for many years.
The Raptors were also able to capitalise on their brand’s off-court success with
on-court success, winning the NBA championship in 2019, cementing their
decision to rebrand away from the initial team logos and colours from the 1990s
– even despite the resurrection of the Jurassic Park series of movies.

As Sportview 5.1 indicates, making branding adjustments is sometimes necessary

in order to achieve the value sought for the overall brand. Once these adjustments
are made, brands are also able to capitalise through increased purchase and
consumption of the product. However, while the Toronto Raptors were successful
with their refinements, this is not always the case. Some teams struggle with their
brand identity and constantly tweak their name, colours and/or logos trying to
find the right ‘recipe’. Keeping with the NBA theme, the Los Angeles Clippers
are a great example of this concept of constant tweaking. The team has changed
logos multiple times since arriving in Los Angeles in 1984, and has failed to build
significant equity in its brand. The value of the brand also took a major hit in
2014 with a racism scandal featuring then owner Donald Sterling. In situations
where brands have limited exposure, licensing can be used as one way to inform
consumers. Licensing can also be used to enhance value, extending the equity that
already exists in the brand.

Licensing
Licensing as an activity involves a licence, a licensor and a licensee: ‘A licence is
first and foremost the granting of an intellectual property right from the licensor
to the licensee’ (Wilkof, 1995, p. 5). This means that the intellectual property
right of a licensor must be valuable enough for a licensee to use and pay a royalty,
which is a fee paid for usage of the intellectual property, often calculated as a
percentage of the sales of licensed products.
In the sport industry, we are most familiar with the usage of names and/or
logos (as the licensed property) of sporting teams or organisations printed on
apparel (such as baseball caps and T-shirts) or other merchandise (pens, mugs,
umbrellas, etc.). These activities build upon an organisation’s sporting
achievements and popularity (such as the case with the Toronto Raptors), or the
general monetary investment in promoting the name, logo or colour scheme in
efforts to create an additional, significant revenue stream.
Not all sporting organisations, however, are in a position to license their name,
logo or other properties to third parties. The name of the sporting organisation, or
more broadly the brand, must be strong enough to generate interest and attention.
For instance, Basketball England, the governing body for the sport in that
country, exists to support elite national competitions and improve participation
among youth, women and girls, and underserved communities. However,
Basketball England does not maintain a strong, recognisable brand within or
outside the country. Thus, affixing its logo to a variety of products would not
necessarily entice consumers to purchase a product. Potential licensees are
interested only if the name or logo can generate extra interest in, and demand for,
the products to which the name or logo is attached.
Baghdikian (1996) revealed the following key factors that a sport marketer
needs to consider with respect to licensing.

Organisational objectives
Licensing should serve the broader purpose of achieving the marketing goals of
the organisation, which in turn should support the achievement of overall
strategic goals. In sport, licensing an organisation’s marques for merchandising
purposes often aims to raise funds or to increase brand awareness. If these goals
fit the marketing strategy, the organisation can pursue a licensee or licensees.

Choice of licensee
Potential licensees should be capable of satisfying specific standards outlined by
the licensing organisation, and should maintain the function of identifying the
source of the products. From an organisational perspective, it is important for the
sporting organisation to find reputable partners with an ability to deliver quality
goods on time and with regular payments.

Commitment
Rather than leaving the work to the licensee and simply ‘licensing’ it to use the
sporting organisation’s trademark, the sport organisation should commit itself to
doing the preliminary market research and financial analysis. Baghdikian (1996,
p. 38) states that:
 the San Jose Sharks, during their first season, compiled the worst on-field
record in the NHL. However, due to the organisations spending 13 months
on consumer research, and planning a name and design that would create an
exciting image in the market, the Sharks outsold all other NHL team-
licensed products.

Resources
In investigating sport and collegiate licensing programmes, Irwin and Stotlar
(1993) conclude that ‘with nearly half of all colleges assigning program
administrators less than 10% of their time to licensing, the complex
administrative tasks associated with a licensing program cannot effectively be
addressed’ (p. 15). Although the resources invested in managing a sport licensing
programme might be high, the resulting benefits are likely to be proportionately
higher than the investment.

Communication
Although licensing agreements should serve as the basis for business
communication, regular and open channels of communication should be
established. A clear understanding of both parties’ goals, the early detection of
problems and effective quality control are the results of open and frequent
communication between licensor and licensee.

Relationships
The more formal business communication described above can be complemented
by more informal communication (for example, between the two chief executive
officers). An afternoon on the golf course with the aim of fostering personal
relationships has often proven vital to the maintenance of business relationships,
and ensures trust and goal congruence between licensor and licensee.

Using the sport brand to extend monetary value

Ultimately, licensing is one of the most important activities used to harness the
power and equity of a brand. For example, sponsors in the Olympic Partner
Programme (TOP) are licensed to associate the Olympic rings with their
products; and a variety of consumer goods licensees in Australia (e.g., Coles
McDonald’s, Virgin Australia, Toyota) are licensed to use the AFL logo on their
products. It is the same with athletes themselves. Consider America’s Serena
Williams (tennis), Jamaica’s Usain Bolt (athletics) and Canada’s Kia Nurse
(basketball). Each of these athletes transcends their home country and provides
significant value to licensees using their name and likeness.
Licensing activities are also incredibly lucrative. According to SportBusiness
(Cronin, 2019), Major League Baseball raked in US$5.5 billion in licensing fees,
followed by the National Football League (US$3.3 billion), the NBA (US$3.2
billion), the NHL (US$1.3 billion) and NASCAR and World Wrestling
Entertainment (WWE), each yielding US$1 billion. One of NASCAR’s events,
the Daytona 500, collected more than US$100 million from licensing income
alone on its 50th anniversary. In particular, event organisers worked with Kroger,
an American supermarket chain, to affix the 50th-anniversary logo in product-
exclusive categories to companies such as Kellogg’s, Unilever, Conagra, General
Mills, Nabisco and PepsiCo. In-store promotions included point-of-purchase
displays, circulars, television advertisements, radio commercials, a dedicated
website, and even appearances by NASCAR drivers. Consequently, Kroger also
experienced an uptick in customer traffic to its stores, justifying its rationale to be
a licensee.
This example clearly shows what the added value is of using a highly regarded
and popular sport brand on other products. It fulfils one of the following
purposes:

to sell in new products using the established brand

to sell in new markets using the established brand
to boost sales using the established brand
to reinforce a particular image using the established brand.

The major aim of the sporting organisation in this process is to use its established
brand to raise funds for the organisation. A bonus is the widespread attention
given to its brand name through the promotional efforts of licensees. This is why
careful selection of licensees is important: the established sport brand should not
be associated with a wrong or inferior product or organisation.

Summary
This chapter defined and described sport as a product. A product is anything that
satisfies a need or want, and is acquired to do so. In relation to sport, two
important concepts have implications for sport marketing. The first is the core
product, defined as the actual game, over which the sport marketer has no control.
The sport marketer must be very careful not to over-promise in terms of how
good a game will be or how well specific athletes may perform. The second
concept is the importance of product extensions to the overall marketing effort. It
is here that the marketer can ensure that acceptable levels of quality are achieved.
Discussion in this chapter also focused on the importance of brand, the act of
branding and the benefits of having a strong brand vis-à-vis the ability to license
the sport product to generate new revenue streams. Specifically, brand and line
extensions were discussed, and considerations for licensing were illuminated.
Issues of strategy were also considered when discussing the product life-cycle.
In this circumstance, the PLC allows the marketer to assess the relative standing
of a product through its phases of growth or decline. The chapter utilised various
examples from around the world, including the KHL and NHL, the NBA and the
NBL. The latter was specifically used to illustrate the application of the product
life-cycle, which revealed some interesting challenges confronting the NBL in its
quest to arrest the plateau in the fortunes of its competition.

CASE STUDY
Setting up a licensing programme
[This case study is purely fictional and updated from an original piece written
by Eddie Baghdikian. Any resemblance to actual persons, organisations and
events is purely coincidental.]
In January 2020, Juan Garcia, director of business development at the South
American Lacrosse Federation (SALF), was approached by ALEGG
Interdomestic Pty Ltd with a proposal promising to generate substantial revenue
for the SALF with no financial outlay required. ALEGG was proposing a
licensing agreement under which the SALF logo would be used to brand a wide
variety of merchandise, and those products would be marketed to SALF
members.
The role of the SALF, as the central administrative body, is to manage,
coordinate and unify the diverse facets of the sport of lacrosse in South
America. This includes overseeing the development of grassroots programmes,
managing competitions and tournaments, and promoting lacrosse at all levels.
As the representative body of all affiliated clubs and associations throughout
South America, the SALF ensures the commercial viability of lacrosse, and
seeks out and encourages sponsorship for lacrosse events on a national level.
The core product of the SALF is essentially the development of the game of
lacrosse. Until the approach by ALEGG, the SALF had never undertaken any
product or brand extension strategies. ALEGG’s proposal to enter into a
licensing agreement with the SALF promised to develop and market a range of
lacrosse merchandise and accessories aimed at SALF members.
The basis for the relationship
Over the next four months, ALEGG would develop a range of SALF
merchandise known as the SALF Members’ Collection. The range of licensed
products would be entirely up to the SALF. ALEGG would source the selected
product line through its ‘worldwide’ manufacturing and supplier network,
which was concentrated predominantly in Southeast Asia. All sourced products
would be ‘branded’, as well as displaying the SALF name and logo. The list of
products included tracksuits, hoodies, shirts and sport duffel bags, as well as
branded coaching items such as lacrosse balls, whiteboards and official game
sheets. ALEGG would primarily be responsible for the promotion and
distribution of all agreed merchandise, including a SALF Members’ Collection
brochure and other advertising material such as posters for all clubhouses.
Coinciding with the marketing campaign, ALEGG would also have the entire
range of goods made available at all major South American lacrosse
competitions, and have a salesperson to service this area. The SALF would not
be responsible for holding and purchasing stock.
The SALF agreed to assist in the promotion of the merchandise through:

South American Lacrosse News (a newsletter for members)

advertising
exposure at all SALF events
regular mailouts to all clubs
a list of club secretaries to be provided to ALEGG, and
mutually agreed general promotions.

So far, the negotiations for the SALF’s licensing programme were going well.
Estimating the projected income from the marketing programme was not as
important to Juan Garcia as the ability to make money out of something
requiring no financial expenditure and a minimal amount of resources. In
addition, the programme would lift the profile of the organisation in the
marketplace through the promotion of the SALF name and logo, building equity
in the brand and revitalising the product. These were the broad objectives Juan
set for the licensing programme. In ALEGG’s final proposal, Juan was also told
that anticipated income in the first formative year would be exceeded
significantly in subsequent years as the promotion programmes gained
momentum and the SALF name and logo grew in recognition.

The agreement
The ‘exclusive licensing/marketing/manufacturing agreement’ between the
SALF and ALEGG was drafted and arrived on Juan’s desk. From this time
onwards, ALEGG’s normal printed letterhead was no longer used, and
communications were now with ALEGG’s international marketing director and
not the SALF’s usual ALEGG contact, the South American general manager –
who seemed to have vanished.
ALEGG was to become the sole and exclusive producer, manufacturer,
wholesaler and marketing representative of the SALF. The agreement stated that
the appointment of ALEGG was verbally formalised and agreed to on Thursday,
9 January 2020 in order to permit ALEGG to incur expenditure in time and
money to set up the logistical, administrative and initial manufacturing and
marketing requirements of the project. However, the three-year term of the
agreement was to officially start on 1 January 2021, with a three-year option
commencing on 1 January 2023 – the three-year option being automatically
renewable except for either party cancelling the agreement.
Cancellation could be done only during the 30-day period in the month prior
to the expiration of any three-year term of the agreement by giving 18 months’
notice in writing. Alternatively, cancellation could be effected, by the SALF
only, during the 30-day period in the month prior to the expiration of any three-
year term of the agreement by giving 90 days’ notice in writing and purchasing
and paying the freight-on-board (FOB) price for all goods and/or services
and/or work in stock and/or in progress for and on behalf of ALEGG in relation
to ALEGG fulfilling its obligations and undertakings as part of the agreement.
Payment then would have to be made prior to the expiration of the 90-day
notice period. In fact, whether or not the SALF or ALEGG breached any of the
conditions of the contract and cancelled, the SALF would still be obliged to pay
the FOB price under the terms of the agreement, a licensing fee equal to 15 per
cent of the manufactured cost, paid at the end of each calendar month. ALEGG
would also conduct the reconciliation and monitoring of all royalty payments.

Disjointed proceedings
The SALF did not hear directly from ALEGG for some time. During the period
up to May 2020, Juan Garcia heard that ALEGG had only made a few
approaches at different SALF-affiliated clubs. At this point, he started to believe
that the project had basically ended.
It was at this juncture that the SALF changed its trading name to Lacrosse
South America and embraced a brand identity featuring a new logo, colour
scheme and font. With the proliferation of initialled identities in the business
world, the use of ‘SALF’ was continually being confused. The decision to adopt
this new identity also brought the organisation in line with Lacrosse
International, the controlling body at the international level. Lacrosse South
America, realising the importance of the role of marketing to its organisation
and in line with the identity change, appointed a marketing and media officer in
April 2003. This position, which reported to Juan, had as its primary objective
the task of lifting the profile of the sport through the media and business world.
Juan, who was now the director of development and marketing, decided to
inform ALEGG of the changes.
On receiving the news, ALEGG advised Juan that it had more than
US$400,000 of SALF-logoed goods on order and approaching delivery, and
further advised that the SALF should consider not changing its name until 2024
to allow a stock rundown without financial loss to all parties concerned. In the
same communication, ALEGG conveyed that in the last few months it had been
gearing up for sales, through the 2931 affiliated clubs, to the 1.1 million SALF
members.
The situation did not improve. The SALF name change went ahead, and
ALEGG kept struggling for credibility – without success. Juan saw no evidence
of any prospect of progress, now or in the future. Lacrosse South America
informed ALEGG in writing that it wished to terminate the proposed agreement
and would deal with ALEGG only on a non-exclusive basis, as required by
Lacrosse South America, the exclusive nature of the agreement also being part
of the reason to terminate.
In the meantime, ALEGG argued that the SALF proposal to change its name
to Lacrosse South America was being done with insufficient prior notice given.
As a result, more capital investment and greater time allowance were now
required. ALEGG also debated that it had outlaid in excess of US$1.2 million in
time and money, all with a view to completing at least the first three years of the
programme, with the intention of ensuring success so that the relationship
would go beyond this initial three-year period.
ALEGG was determined to represent itself as a dedicated organisation with
the right intentions to implement the letter of agreement, and to represent the
SALF/Lacrosse South America as the main cause of the current state of the
project through its lack of cooperation, commitment and communication.
Nevertheless, ALEGG continued to have dialogue with Lacrosse South America
on the ‘new’ line of merchandise and the ‘new’ 2023–24 catalogue/brochure
incorporating the Lacrosse South America logo. ALEGG also discussed new
club member updates and marketing strategy, and looked forward to receiving
Lacrosse South America’s positive response and full support.
 Questions
1. Discuss the risks and rewards to an organisation of licensing its brands.
2. How well does the strategy of extension, through licensing, fit the
corporate objectives of the SALF?
3. Identify the reasons why the licensing activity between the SALF and
ALEGG failed.
4. What factors should Juan Garcia have considered in making his decision
on whether or not to enter into the licensing agreement with ALEGG?
5. Juan felt that the SALF logo had no inherent appeal or value. On what
criteria should the marketer judge the value of a brand and its suitability
for licensing?

References
Armstrong, G., Adam, S., Denize, S., Volkov, M., & Kotler, P. (2018).
Principles of marketing (7th edn) Pearson, Sydney.
Baghdikian, E. (1996). Building the sports organization’s merchandise
licensing program: The appropriateness, significance, and considerations.
Sport Marketing Quarterly, 5(1), 35–41.
Cronin, B. (2019, August 8). Major League Baseball tops list of sports
licensors with $5.5bn in sales. SportBusiness.
https://www.sportbusiness.com/news/major-league-baseball-tops-list-of-
sports-licensors-with-5-5bn-in-sales.
de Chernatony, L., & McDonald, M. (1992). Creating powerful brands: The
strategic route to success in consumer, industrial and service markets,
Butterworth-Heinemann, Oxford.
de Chernatony, L., McDonald, M., & Wallace, E. (2010). Creating powerful
brands (4th edn). Butterworth-Heinemann, Oxford.
Gladden, J., Milne, G. R., & Sutton, W. (1998). A conceptual framework for
assessing brand equity in Division I college athletics. Journal of Sport
Management, 12(1), 1–19.
Irwin, R.L., & Stotlar, D.K. (1993). Operational protocol analysis of sport
and collegiate licensing programs. Sport Marketing Quarterly, 2(1), 7–16.
Lovelock, C.H. (1991). Services marketing (2nd edn). Prentice Hall,
Englewood Cliffs, NJ.
Mullin, B.J. (1980). Sport management: The nature and utility of the
concept. Arena Review, 3(4), 1–11.
Mullin, B.J. (1985a). Characteristics of sport marketing. In G. Lewis & H.
Appenzellar (eds), Successful sport management. Michie, Charlottesville,
VA, 101–123.
Mullin, B.J. (1985b). Internal marketing: A more effective way to sell sport.
In G. Lewis & H. Appenzellar (eds), Successful sport management. Michie,
Charlottesville, VA, 157–175.
Mullin, B.J. (2000). Characteristics of sport marketing. In H. Appenzellar &
G. Lewis (eds), Successful sport management (2nd edn). Carolina Academic
Press, Durham, NC, 127–149.
Mullin, B.J., Hardy, S., & Sutton, W.A. (2014). Sport marketing (4th edn).
Human Kinetics, Champaign, IL.
Naraine, M.L., Pegoraro, A., & Wear, H. (2021). #WeTheNorth: Examining
an online brand community through a professional sport organization’s
hashtag marketing campaign. Communication and Sport, 9(4), 625–645.
https://doi.org/10.1177%2F2167479519878676.
Perreault, W.D., Cannon, J.P., & McCarthy, E.J. (2013). Basic marketing
(19th edn). McGraw-Hill, New York.
Shilbury, D. (1989, Autumn). Characteristics of sport marketing: Developing
trends. ACHPER National Journal, 21–24.
Shilbury, D. (1991, July). Marketing scores with game plan for sports.
Marketing, 18–22.
Slack, T., & Parent, M.M. (2006). Understanding sport organizations (2nd
edn). Human Kinetics, Champaign, IL.
Szporer, R. (2019, November 7). KHL stands apart from NHL under
President Chernyshenko. The Hockey Writers.
https://thehockeywriters.com/khl-nhl-chernyshenko-cap.
Wilkof, N.J. (1995). Trade mark licensing. Sweet & Maxwell, London.
Wirtz, J., & Lovelock, C. (2016). Services marketing: People, technology,
strategy (8th edn). World Scientific, Hackensack, NJ.
Zeithaml, V.A., Bitner, M.J., & Gremler, D.D. (2017). Services marketing:
An integrated approach across the firm (7th edn). McGraw-Hill, Boston,
MA.
Zillgitt, J. (2014, July 8). Raptors’ Tim Leiweke explains ‘We The North’
mentality. USA Today.
https://www.usatoday.com/story/sports/nba/raptors/2014/07/08/tim-leiweke-
toronto-canada-basketball-drake-steve-nash-masai-ujiri/12364599/.
CHAPTER 6

Sport and pricing strategies

DOI: 10.4324/9781003270522-9

Chapter objectives
Chapter 6 introduces price as one of the marketing mix variables. Pricing
strategies are discussed in this chapter in relation to overall organisational and
marketing goals. Pricing as a process is defined as setting or adjusting a price
charged to a customer in exchange for a good or a service. The techniques used
to determine price, as well as the role of price in the marketing mix, form the
basis of the chapter. As well as providing a framework to assist with
determining price, the macro-perspective of achieving positive overall outcomes
for sport organisations is discussed. As will be shown, the ‘big picture’ cost–
benefit analysis should always be the overriding measure of pricing
effectiveness.
After studying this chapter, you should be able to:

distinguish between factors that influence the pricing process

see pricing in the context of organisational strategy
determine demand and supply relations and the price sensitivity of markets
apply a strategic pricing approach in setting or adjusting the price of sport
products.

Headline story
The relative ‘price’ of hosting major sporting events
If you believe the protestations of the ‘Save Albert Park’ group, a committee
that vehemently campaigned against the location of the Australian Formula 1
Grand Prix at the Albert Park circuit in Melbourne, a city would be unwise and
irresponsible to consider attracting and hosting an international sporting event.
In 2013 the group commissioned a cost–benefit analysis of the 2011 Grand Prix
for its own purpose. The report concluded that the race made a conservative net
loss of between A$39.9 million and A$57.7 million. This contentious amount
did not take into consideration the non-market values of noise and park amenity,
media exposure and benefits to the State of Victoria. Opponents argue that the
race consistently reduces the welfare of Victoria by tens of millions of dollars
each year (Economists at Large, 2013).
On the other hand, the socio-economic conservationists are continually
overwhelmed by the mass public and political appeal forged by hallmark events.
In addition to the economic stimulus, research on hallmark events tends to
reveal that their social impact is often positive, providing a normative glue
fastening parochial sport fans and even the less frequently interested sport
theatregoers with a vast bonding of collective identity and vicarious experience.
However, the increasing operating deficit that is subsidised by Victoria’s
state taxpayers remains a bone of contention. According to the Australian Grand
 Prix Corporation (AGPC, 2019), in recent years these taxpayers have subsidised
the event to the value of A$60.15 million (2019), up from A$56.5 million in
2018 and A$34.63 million in 2007. With attendance figures recorded at 320,000
in 2019, they have remained relatively stagnant (and disputed) since 2006. After
intense discussions and competitive bids from rival nations in the Asia Pacific
region to host the event, the AGPC contract has been renewed until 2025,
making it a 30-year agreement to stage a premier event. However, the million-
dollar question lingers: is the event worth the relative price to the host city
(Dwyer et al., 2020)?

As a process, pricing can simply be defined as setting or adjusting a price charged

to a customer in exchange for a good or service. Pricing a product or a range of
products properly is of utmost importance to an organisation. The level of pricing
determines how many customers are inclined to buy the organisation’s products.
At the end of the day, the price multiplied by the number of products sold must at
least cover the costs of production. This is, however, a simplified version of
reality, which will be elaborated on later in this chapter.
In Chapter 5 it was shown that the sport product is made up of different
components: the core product and product extensions. Although the core product
may be the main attraction for customers in terms of potential income, product
extensions make up a considerable part of the overall revenue for sporting
organisations. This is one reason why, for example, the Australian Football
League (AFL) does not price its core product (tickets to attend a football match)
at a maximum level. The core spectator product is priced relative to the product
extensions (such as sponsorship services and media rights) – or, in other words,
the total product mix. Throughout this chapter, examples of this ‘big picture
perspective’ will be given in relation to hosting major sporting events and city
marketing.
In this chapter, the pricing process will be examined from a strategic
perspective. After presenting a strategic pricing model, the different steps of this
model will then be discussed.

The strategic pricing process in sport

The importance of recovering the costs of production through setting the right
price is highlighted in the above headline story. However, cost of production is
only one of the variables that needs to be taken into consideration when setting or
adjusting price. The strategic pricing process incorporates both internal
characteristics of the organisation and its products (for example, goals and
objectives) and external characteristics (such as competitors’ pricing behaviour).
This will enable the marketer to create a pricing strategy beyond the short-term
future of the organisation. Figure 6.1 describes the strategic pricing process for
sporting organisations.

Figure 6.1 Strategic pricing process.

Step 1: Determine pricing goal(s)

Although there is a subtle difference between introducing a product then setting a
price and adjusting the price of an existing product, the pricing goal must be
determined for both. It is vital to recognise the influence that price has on
customers’ perceptions of a product. A relatively high-priced product will often
be perceived as a high-quality product. Pricing, in other words, has a strong
impact on the positioning of the product. Determining the pricing goals should be
a direct derivative of the organisation’s reason for being (that is, its mission) and
the resulting marketing goals. Marketing goals of different organisations and
derived pricing goals are shown in Table 6.1.
Table 6.1 Marketing goals and derived pricing processes
Marketing goals Derived pricing goals
Maximise shareholder value Maximising profit
 Marketing goals Derived pricing goals
Maximising sales growth
Maximising revenue
Be the most innovative in the business Market skimming
Deliver the highest quality products Premium price
Full cost recovery
Be accessible to all members of the community
Partial cost recovery

Maximum shareholder value

Private enterprises and privately owned sport franchises often pursue goals
designed to maximise shareholder value. In order to do this, pricing goals would
include maximising profit, maximising sales growth or maximising revenue.

Maximising profit is often seen as a short-term goal, concentrating on current

financial performance and assuming little influence from competitors (that
is, to undercut the set price).
Maximising sales growth is a long-term pricing goal. Although profits could
be higher, the organisation aims to sell its products at a lower price to as
many customers as possible. The goal is to obtain a large share of the market
and reap the subsequent long-term benefits. Athleisure wear companies, for
example, have recently directed their sales strategies towards the developing
nation markets, where the rise of sport and leisure activity coupled with an
increasing middle-class band of consumers with higher disposable income
has led to a rise in sales and popularity of sport and leisure wear.
Maximising revenue can be the pricing goal of sport organisations seeking
cross-code partnerships. For example, in Australia, football code bodies such
as the AFL or the NRL are seeking formal or informal partnerships with
other sports such as baseball and netball. These partnerships enable both
sports to create different commercial and market opportunities not readily
accessible if each code is delivered independently (Harris, 2018).

Most innovation
If an organisation aims to be an innovative company, the pricing goal may be to
skim the market. Nike, as an athletic footwear and apparel manufacturer,
establishes a price high enough for a small segment of the market to buy its
products. Design and technology drive the competition to develop athletic
footwear to suit the needs of all types of active consumer. As soon as competitors
introduce similar products, Nike lowers the price to sell to the segment below the
‘early adopters’. Nike skims the market by receiving the maximum price from the
different segments of the market. Nike can adopt this strategy because it ensures
that it is the first to introduce a new, trendy, high-quality product.

Highest-quality products
If an organisation aims to deliver the highest-quality products, a premium pricing
strategy may be an alternative pricing goal. In order to communicate the high
quality of the product, a correspondingly high price is set. Momentous sporting
events such as a world title fight or NBA final allows the organisers to charge a
premium ticket price as customers perceive the high-quality features of the event
as priceless. In 2017, the showdown fight between Floyd ‘Money’ Mayweather
and Connor McGregor commanded an outrageous US$110,000 for a ringside seat
(Kavakos & Calver, 2021). Thus, the temptation for organisations to seek an
above-average return on ticketing as a consequence of perceived customer value
is very high.

Community accessibility
Not-for-profit organisations, government organisations and many sporting
organisations often set pricing goals such as partial or full cost recovery.
Community sports teams may set membership prices in order to recover their
costs because they do not need to make a profit, their main goal being to provide
sport and leisure activities that serve the community. National sport governing
bodies can price their products in order to break even, incorporating funding from
the federal government (partial cost recovery). The London Olympic Games
Organising Committee proposed a stated community goal regarding its pricing
strategy, summarised as ‘Everybody’s Games’. This goal saw that half of the 8
million tickets for the 2012 London Olympics were sold at £20 in order to create
‘shared value’ between local ‘Londoners’ and revenues for the Games (Bertini &
Gourville, 2012). Ticket sales for the 2016 Rio Olympics also considered
affordability issues. With 28 sports and 717 events, over half the total tickets (3.8
million) were made available for 70 Brazilian real (about A$18) (Wright, 2014).
Setting or adjusting the price depends not only on the goals of the organisation
but also on the other elements of the pricing process. This will become clear in
the following sections.

Step 2: Determine market sensitivity to price

How sensitive customers are to a change in price is important in determining a
range within which the final price may be set. It is also vital to know the
estimated size of the market and how it is segmented. In this section, it is
assumed that this information is available. The concepts of demand and supply,
price elasticity and non-price factors are important in determining market
sensitivity to price. Given the marketing focus of this book, we start by discussing
the concept of demand.

Demand
The quantity demanded of the product by potential customers depends on the
price assigned to the product. In general terms, the higher the price of a product,
the lower the quantity demanded. Figure 6.2(a) shows that, for a certain product,
a demand curve can be drawn demonstrating the linear relationship with the price.
The quantity demanded also depends on the prices of other factors, such as
product (substitutes and complements), income of customers, expectations of
future prices and the size of the population.
Figure 6.2 Demand, supply and market equilibrium.
Substitutes are products that can be used in place of other products (e.g., spectator
tickets to a football match and a basketball match). If the price of a product
(football tickets) rises, the quantity demanded of the substitute (basketball tickets)
is likely to rise as well because consumers may elect to purchase the cheaper
substitute. During the 2020 COVID-19 pandemic most sport activity, whether it
was a community-based junior competition or international mega event such as
the Tokyo Olympic Games, was cancelled. The economic implications for sport
entities, sponsors and the media alike during adverse scenarios such as this are
potentially financially catastrophic. Sport organisations must seek out substitute
programmes to maintain some sort of income for the financial year. So, for
example, US broadcaster ESPN turned to alternative and somewhat bizarre sports
such as cherry pit spitting, Stupid Robot Fighting and sign spinning to attract
sport enthusiasts to its network. Maintaining advertising revenues and a
connection with television audiences is central to this substitution strategy (Koop,
2020).
Complements are products used in conjunction with other products (e.g., golf
clubs and a golf course membership). If the price of a product (golf course
membership) falls, the quantity demanded of this product and its complement
(golf clubs) will rise.
Generally, when the income of customers rises, demand for most goods will
also rise. Expectations of higher prices in the future may prompt customers to buy
now, and hence demand will rise. In general, the larger the population, the greater
the demand will be for products.

Supply
When a product is providing attractive returns to producers, more organisations
will be inclined to supply the product to the market than when the price is
relatively low. In general terms, the higher the price of a product, the greater the
quantity supplied. Figure 6.2(a) shows that, for a certain product, a supply curve
can be drawn demonstrating a linear relationship with the price. The quantity
supplied also depends on resource prices, technology, the number of sellers and
expectations about future prices.
In general, when resource prices rise, the quantity supplied will fall. Similarly,
technological improvements and increasing efficiency will result in a rise in the
quantity supplied because a greater quantity can be produced at the same cost.
The more sellers there are, the greater the quantity supplied. Expectations about
future prices are a more complicated issue. With the near shutdown of sport
activity in 2020 globally, and the expectation for members of all societies to
isolate from others in the community, there was a significant spike in demand for
active leisurewear, home gym equipment and bicycles. Manufacturers and online
retailers were able to set a premium price for these products as demand exceeded
supply during this time. However, manufacturers of sporting goods specifically
used in competition, such as tennis racquets or sports uniforms, saw a significant
decline in demand which greatly affected the organisational ‘bottom line’.

Market equilibrium
In relation to tennis racquet purchases, Figure 6.2(a) shows that, at the point
where demand equals supply, the market is in equilibrium (E). This point
represents the price that the market is prepared to pay, given the quantity
supplied. Figure 6.2(b) shows that at a price of $120 there will be a supply of
120,000 racquets, but demand for only 80,000. There will therefore be an excess
supply of 40,000 racquets. Figure 6.2(c) shows that the reverse will occur at a
price lower than the equilibrium price (here $80). Therefore, in that situation
there will be an excess demand of 40,000 racquets.
If the demand for tennis racquets after a Grand Slam rises, the demand curve
will move to the right. This will result in a rise in the quantity supplied (that is, a
movement along the supply curve) because the price will go up to establish a new
equilibrium. Let us assume that people keep demanding the new quantity. With
this increase in demand, new producers will be lured to the market because of the
higher price, supply will go up and the supply curve will move to the right. This
again will result in a fall in price. Equilibrium will return to the point where it is
not attractive enough for new suppliers to enter the market. At the end of this
process, the only change will be that the total quantity supplied has risen. It goes
beyond the scope of this book to further elaborate on demand and supply issues.

Price elasticity of demand

We have now explored the influence that price can have on the quantity of
products supplied and demanded. What we do not know is how sensitive a
customer is to a change in price. Will a rise or fall in the price of a product result
in a great or small change in the quantity traded? Price elasticity of demand is a
measure projecting this relationship. It is calculated as the absolute value of the
change (%) in the quantity demanded, divided by the change (%) in price. The
absolute value can range between 0 and infinity. A value between 0 and 1
represents inelastic demand; a value greater than 1 represents elastic demand; and
a value of exactly 1 is called unit elastic demand.
Figure 6.3(a) shows that inelastic demand occurs where the fall (%) in the
quantity demanded is less than the rise (%) in price. In other words, the
organisation will benefit from raising the price because the number of customers
lost will be lower than the gain in revenue. For example, elite boxing events are
staged by multiple independent agencies, each with competing interests. Boxing
fans shoulder the burden of high ticket prices when premium seating tickets are
sold to third-party brokers and then sold on to the consumer at a higher price. The
first-hand experience of witnessing a high-intensity fight surpasses any rational
decision making on the purchasing price of a ticket. Boxing events with headline
performers such as Floyd Mayweather will sell out regardless of price
(McCarson, 2014).

Figure 6.3 Price elasticity of demand

Figure 6.3(b) shows that if the fall (%) in the quantity demanded equals the rise
(%) in price, the elasticity of demand is 1 (unit elastic demand). This means that
total revenue will not change.
In Figure 6.3(c) it is also shown that if the fall (%) in the quantity demanded
exceeds the rise (%) in price, demand is considered to be elastic. In this case, the
organisation will benefit from the reducing price because the gain in number of
customers will be greater than the loss in revenue. For example, the number of
customers will vary greatly (that is, rise) when the price of a golf course
membership is lowered.

Factors determining elasticity

The size of the elasticity of demand is mainly determined by three variables:

the substitutability of the product

the amount of time since the price change, and
the proportion of customer income spent on the product.
The more substitutes there are available for a product, the easier it is for a
customer to replace one product with another when the price rises; hence the
higher the price elasticity. Say, for example, a range of professional sports are
taking place in the metropolitan area of Melbourne less than a kilometre apart. A
rise in the admission price for one sport will force customers to search for cheaper
alternatives. A substantial price rise will result in an even more substantial loss of
customers. However, existing customers of a basketball club, for instance, will
not immediately be able to go to a football club because they may have purchased
long-term memberships.
The longer the time since the price change, the more opportunities customers
will have had to find alternatives; hence the greater the elasticity of demand. The
higher the proportion of customer income spent on club membership, the higher
the elasticity of demand. If expenditure represents a large part of an individual’s
income, every extra dollar on top of that expenditure will be scrutinised and can
make the customer decide not to purchase. If, however, a very rich person has to
make the same decision, money spent on membership represents only a small
portion of total income, and so a price rise will not greatly affect the decision to
buy. This last example shows that price elasticity of demand can differ not only
between products but also between consumer groups, and thus provides the
marketer with the opportunity to differentiate between customer segments.
Different issues related to price elasticity of demand are explored in an historical
review of pricing in the sport of Australian Rules football. Sportview 6.1 reflects
on how sport organisations can better exploit various elasticities of demand by
applying the concept of dynamic pricing. We will return to that concept a bit later
in this chapter.

SPORTVIEW 6.1
Capturing and monetising value for sport franchises
Nader Chmait and Hans Westerbeek
Most sport franchises are continually seeking opportunities to increase
revenues while simultaneously maintaining or improving the fan experience.
Franchises often tread a fine line when setting pricing strategies that both
enhance the competitive position of the franchise and do not damage the
relationship with fans. The value of any sport experience can vary from event to
event, and even within the same event. For example, the purchasing of food,
merchandise and other products and services throughout a game fluctuates
according to breaks in the game or the intensity of the game. Yet many such
 products/services are seen as fixed price commodities throughout the event or
the entire season.
Dynamic pricing is a strategic means of exploiting a ‘moment of value’.
Moments of value are those points in time throughout a game or a season when
customers are willing to pay a little more for a product or service as
circumstances heighten their purchase decision making. Club merchandise
immediately prior to and at the start of a season should be set at a premium
purchase price. Innovators and early adopters wish to be recognised as the first
buyers of new merchandise and, importantly, drive the wider sport community
to adopt. As a season progresses pricing can be adjusted to encourage the
majority of fans to make the same product purchases. Should the team then
make the finals, pricing can return to a premium.
The key to being more flexible with the organisation’s pricing strategies for
traditionally fixed priced products and services is in understanding both those
moments: when the team’s value changes and what the consumer is willing to
pay at different stages of the sport experience. The use of analytics enables sport
franchises to collect and make sense of ‘big data’ about fan behaviour. A model
for dynamic pricing as suggested by analysts at Deloitte Consulting proposes
dynamic pricing centring on yield management. It requires the sport franchise to
better harness complex data, mine customer behaviour information and identify
the areas where flexibility in pricing can occur. Implementing solutions via
technological data-mining innovations and then integrating them into the
franchises business model is a more predictable method for capitalising on
revenue streams.

Source: Singh et al. (2014).

Non-price factors
Non-price factors influence buying situations and reduce the importance of price
in the buying process. Non-price factors include an intangible perception of a
product or the influence of socialisation agents, resulting in a perceived value
being shaped. In other words, some customers may be willing to pay a higher-
than-average market price (premium price) to receive product benefits. Other
customers may be willing to forgo those benefits in return for a lower-than-
average market price. For marketers, it is therefore important to understand key
product attributes in order to enhance the perceived value and hence charge a
premium price. In sport, a consumer may place a final value on an entry ticket
contingent upon a number of variables that influence their enjoyment, such as an
event’s or product’s attractiveness, its uniqueness or the fact that the event
involves an opportunity to share the experience with friends or colleagues. The
Melbourne Cricket Ground (MCG) is identified as the ‘spiritual’ home of sport in
Australia. MCG management is therefore able to create a perceived high-value
product to consumers simply because of its history and capacity to stage a
multitude of sport and entertainment events.
In the sport industry, non-price factors are very important. The rules of
demand and supply, and price elasticity, can be applied to a sport’s core product
and extensions. In addition, different combinations of core and extensions can
enhance the perceived value of the total product, justifying extra expenditure for
customers. The core product cannot be remixed; but, in combination with
different product extensions, the perceived value of the total package can be
increased (for example, the AFL’s mobile app in partnership with Australian
telecommunications company Telstra).
Furthermore, the more important the product is to the consumer, the less
important price will become. For example, a $100 repair on a $2000 bicycle will
enable a cyclist to ride the bicycle again. The perceived value of the $100
expenditure is likely to be higher than that of another $100 expenditure on
something less important to the cyclist (such as a television repair).
If the marketer is able to enhance the perceived value of the product,
customers will become less sensitive to price (that is, elasticity will decrease) and
the organisation will benefit from raising the price. This also applies to the
reverse situation. If the marketer is able to filter out costly product attributes that
are less valued by customers (for example, cushioned seats or undercover seats in
a sport stadium), customers will become more sensitive to price (that is, elasticity
will increase) and the organisation will benefit from lowering the price.
It is clear from these examples that different segments of customers are
targeted as part of the pricing strategy. The next section shows the impact of the
cost–volume–profit relationship.

Step 3: Estimate the cost–volume–profit relationship

Cost–volume–profit analysis, also called break-even analysis, examines the
interaction of factors influencing the level of profits. These factors, as identified
by McNair-Connolly and Merchant (2020), are:

selling prices
volume of sales
unit variable cost
 total fixed cost, and
sales mix.

The first four factors are discussed in this section, with sales mix left to the
section on constraints by other marketing mix variables (product mix).
In general terms, the total costs of production represent the minimum financial
figure (that is, the break-even point) that needs to be recovered from sales in
order to at least break even (total costs = total revenue). Total costs are made up
of a fixed cost and a variable cost component. Fixed costs are the costs that an
organisation has to incur in order to operate (for example, costs of plant and
equipment, taxes, insurance), regardless of the level of production. Variable costs
fluctuate in direct proportion to changes in the activity of the organisation. The
cost of direct materials like leather for shoes is a good example. Pertaining to the
goals of the organisation, the break-even point may vary. For an organisation with
a partial cost-recovery goal, this point is relatively lower than for a full cost-
recovery organisation. Both organisations, however, need to be able to ascertain
their cost of production, enabling the organisation to arrive at a minimum price
for its products by dividing the cost of production by the (estimated) number of
products sold.
For a large athletic footwear manufacturer, total costs are made up of a fixed
and variable component. In order to produce 10,000 pairs of shoes a day, for
example, a certain infrastructure needs to be evident. Plant, equipment and labour
are needed in order to start operations and thus represent the fixed costs of
operation, which are independent of the output level. The raw material to
manufacture the shoes is the major component of the variable costs, which vary
with the output of the plant. Although certain levels of production will be more
efficient, in this example it is assumed that the variable cost per unit of
production is the same. In Figure 6.4, a break-even chart is shown.
 Figure 6.4 Break-even chart.

It can be derived from Figure 6.4 that the higher the total costs, the lower the
average fixed cost in each unit of production (here, pairs of shoes). In other
words, the fixed cost component will decrease with volume of production. If a
factory with building costs of $10 million produces 100 million pairs of shoes
over its productive lifetime (say, ten years), the fixed cost component in every
pair of shoes is $0.10. The relationship between total fixed costs, price and unit
variable cost can be shown in the break-even formula:

Total f ixed costs

Break-even point (pairs of shoes) =
Unit price − Unit variable cost

The formula shows that, with a variation in the unit price, the number of shoes
sold to break even varies. This relationship is shown in Table 6.2. When we turn
our attention to service products – and many sport products are service products –
the unit variable costs in the break-even formula are much harder to determine.
Many costs are both fixed and shared across different services. In a large stadium,
the building, its equipment (indoor courts, tennis nets, computers, etc.) and labour
(most of which is often multi-skilled in order to deliver different services) are all
needed to provide the total mix of services offered by the facility. The variable
costs per unit are therefore hard to determine. What, for example, are the variable
costs of providing basketball spectator services when one extra ticket is sold?
Most costs have to be incurred, irrespective of the number of customers on the
day or over a longer period.
Table 6.2 Relationship between unit price and break-even point
Unit Break-even point (pairs of Unit variable Total fixed costs (per
price shoes) cost year)
10 2 000 000 5 10 million
100 105 264 5 10 million
200 51 282 5 10 million
We can state that most costs are fixed. This is why it is very attractive to entice
that one extra customer: with little to no extra (variable) cost, the revenue from
one extra customer is almost pure profit. This explains why, in the health and
fitness industry, competition is based primarily on price. An organisation has to
incur little extra cost in order to gain a substantial increase in revenue.
This also indicates the importance of managing the non-price factors in the
sport industry. Because we know that most costs are fixed, it becomes a matter of
sophisticated marketing to enhance the perceived value of the sport product. This
should lead to sufficient and sustainable market share to at least cover the costs of
operation. More recently, with the rise of big data computing, the concept of
dynamic pricing is becoming more popular in the sport industry. Dynamic pricing
allows for both profit maximisation and lowering the break even point of sales.
We will return to this concept later in the chapter.

Step 4: Determine pricing strategies of major competitors

As in any strategic planning effort of an organisation, it is important to monitor
competitor behaviour and adjust actions accordingly. The first questions that need
to be answered are: Who are the major (potential) competitors? Do they operate
in the same market (for example, an amateur soccer team and a professional
basketball team) or even in the same segment of the market (for example, an
inner-city golf course and a working-class outer suburban golf course)?
Organisations can then determine when to respond to price changes by
competitors.
The next step is to determine how competitors are positioned in terms of their
relative prices, providing an organisation with an indication of the competitive
price range for which the product is on offer. It would also be very useful to know
which strategies of competing firms are successful.
Finally, if an organisation is able to find out what the probable responses of
competitors would be to a price change, different pricing scenarios can be
developed in order to make the appropriate choice.

Step 5: Determine constraints on pricing behaviour

Laws and regulations are the most obvious constraints on pricing behaviour. Most
of these are a direct result of government intervention in regulating the market
behaviour of organisations. Some cases of price fixing (that is, agreement
between organisations on price) can be regarded as disadvantageous for the
public, and are therefore forbidden by law. In order to keep government-owned
facilities accessible to all members of the community, local government can set a
maximum price level (ceiling). Even when a management company is hired to
manage the local pool, local government can constrain its pricing strategies. In
Australia, sports such as soccer can set high membership fees, and for lower
socio-economic groups this makes sport participation for children or families
more difficult. Sport Australia found that Australian families on average spend
around A$784 per child to participate in sport. State governments therefore
implemented a ‘FairPlay’ voucher system for those suffering financial hardship
and unable to pay the full price for junior sport club memberships. The voucher
system was developed to optimise participation levels for young Australians
(Kleyn, 2020). As a national elite football body, the AFL also subsidises
programmes to ensure that there are no barriers to Australian Rules football
involvement.
Social responsibility constraints can also affect the pricing behaviour of
organisations. If, for example, the local professional netball club feels that
members of the local community with disabilities should be able to enjoy a game
of netball, it will have to adjust its facility in terms of access and seating
arrangements. This will have a direct impact on the fixed-cost component of the
club’s total costs, and it may decide to set different unit prices (for example,
admission) to recover those costs. The pricing strategy of this club will be
different from that of a club focusing solely on profit maximisation. Legal and
social responsibility constraints therefore limit the pricing range for the product.

Step 6: Determine constraints of other marketing mix variables

The variables of the marketing mix – product (mix), place (dependence) and
promotion (mix) – all affect each other.

Product mix
Prices in supermarkets are based on the overall mix of products rather than the
individual products. Some products are priced at an attractive level (for example,
soft drinks during summer) in order to entice customers to do the rest of their
shopping in the same supermarket. A strategy adopted by expansion clubs in the
AFL in Sportview 6.1 demonstrates the importance of looking at the overall
product mix before pricing individual products. The AFL’s admission prices are
low compared to other sporting bodies – particularly in new markets where there
is a high substitutability of the AFL product by rugby league and rugby union.
These prices attract larger crowds, enhancing the atmosphere for attractive
television coverage; as a consequence, they have an impact on the attractiveness
of the total product for media sponsors. The AFL can offset the loss of income
from gate receipts against the increase in income from media rights, sponsor
contracts and other in-stadium purchases.
The AFL extended its product mix in 2016 with the first season of a women’s
league (AFLW) hosted in 2017. Concerns were raised prior to the inaugural
season that by not charging fans to attend AFLW matches in 2019 the product
offering would be perceived as of lesser quality. However, this turned out not to
be the case. Initial interest in women’s football at the elite level was so strong that
many fans were turned away as stadium attendances reached capacity. Overall
though, the ‘non’-pricing strategy became a stroke of genius for the AFL as
consumer support grew throughout the season, culminating in an astonishing
53,000 fans attending the AFLW Grand Final. Television broadcaster Channel 7
created a sport broadcast with crowd atmosphere that also attracted a large
television audience. In 2020 the AFLW attracted further teams to the competition,
and the AFL implemented a flexible pricing strategy whereby minor round games
remained free but other matches – such as the Bushfire Appeal fundraising game
or marquee (leading) AFL/AFLW double-headers – were ticketed (TWG Staff,
2019).

Place dependence
The majority of sport products are produced and consumed in a facility
specifically designed to produce those sport products. The capacity of the facility
limits the number of customers that can be serviced at a certain point in time, and
consequently the maximum total income. The location of the facility determines
the catchment area of potential customers, and hence partly determines the profile
of the customer. In general terms, dependence on the place of distribution further
limits the possible pricing range of the organisation’s products. Place dependence
is discussed in more detail in Chapter 7. Sportview 6.2 further extends the
concept of dynamic pricing, and introduces how admission ticket pricing can
differ dependent on a number of variables that (may) alter the perceived value of
the ticket.
SPORTVIEW 6.2
Variable and dynamic pricing in Major League Baseball (MLB)
Nader Chmait and Hans Westerbeek
The distinction between variable and dynamic pricing is that the former
refers to a set of predetermined prices for different ticketing options, whereas
the latter consists of a demand-based, real-time adjustment to prices. The
influence of variable and dynamic ticket pricing has been investigated in
different areas of sports. One of the first sports teams to instigate variable ticket
pricing was MLB’s Colorado Rockies. The Rockies adjusted admission ticket
prices according to factors such as the day of the week and the specific
competing teams, among others; but, once set, these prices remained constant
throughout the season. Furthermore, Rascher et al. (2007) analysed the MLB’s
variable ticket pricing approach and showed that an optimal variable pricing
strategy would have delivered a large increase in revenue for certain MLB
teams.
Dynamic pricing models are different from variable pricing models as prices
are updated (almost) continuously in real time, and usually all the way to the
start of the event. Notably, dynamic or real-time pricing is widely implemented
in the travel industry, although under different terms such as revenue
management or yield management. The concepts underlying revenue
management have also been recognised as being applicable to sport where a
demand-based approach to pricing helps maximise profit while allowing
different types of fans to purchase tickets at favourable prices. To this end, in
2010, the MLB’s San Francisco Giants reported a 7 per cent increase in profit
through using a day-by-day Dynamic Ticket Pricing (DTP) model adapted from
flight and hotel room pricing models.
MLB data has also been used to investigate the determinants of ticket prices,
and therefore fan responsiveness to pricing changes in a DTP setting. For
instance, this applied to the increased willingness of Giants fans to pay a
premium for seats associated with weekend sessions, key opponents and/or
winning teams. Factors influencing pricing were also aligned with available
promotions as well as marquee players. Other research found some managerial
considerations and guidelines for implementing a demand-based approach to
pricing in sports (using the San Francisco Giants’ DTP as an example),
identifying potential advantages and limitations of using DTP. Again, the
player/team (performance) factor was present as one of the criteria that
explained the fluctuations in consumer preferences to pay for sport event
 tickets. Further, factors related to team and individual performance, ticket types
and time of release were significant determinants of price, while other aspects
were shown to be more market-specific

Additional sources: Cameron (2002); Drayer et al. (2012); Kahn (2011);

Kimes (2003); Kobritz & Palmer (2011); Paul & Weinbach (2013); Shapiro
& Drayer (2012, 2014).

Promotion mix
The promotion mix – that is, the means by which communication with the target
markets will take place – can be constructed after product, price and place
information is available. A low price strategy often needs an intensive
promotional effort in order to sell as many units as possible. If the tools for
intensive promotion are not available due to limited funds, the organisation will
be limited in pursuing a low price strategy. The promotion mix constrains the
pricing strategy. A pricing strategy never stands on its own as it needs to be
backed by adequate promotional efforts. One of the characteristics of services is
that they cannot be stored as services are time-dependent.

Step 7: Determine time-dependence

A spectator at the Olympic Games witnesses the production of the sport product
at the same time they consume the product. The customer is therefore part of the
production process. When the Games are over, nobody will ever be able to
consume this (past) product again. Dependence on the time of consumption
makes it imperative for the Olympic organising committee to sell as many tickets
as possible because the tickets for today’s event cannot be sold the next day.
Time-dependence makes sport suitable for price discrimination. This implies
that different groups of customers pay different prices for basically the same
product. In the case of a health and fitness club, part of the peak demand (that is,
full utilisation of capacity) between 5.00 p.m. and 7.00 p.m. can be moved to a
low-demand timeslot by offering the same product at a lower price during an off-
peak time. Senior citizens and parents with home duties, for example, may be
able to take advantage of this offer. Pre-selling tickets to the Olympic Games is
another example of price discrimination. There are two ways to look at the price
of pre-sold ticketing. First, by offering the same tickets at a lower price, the
Olympic organising committee fills seating capacity with customers who are able
to plan and purchase in advance. On the other hand, this same group of organised
fans may be discriminated against if discount ticketing occurs as the event draws
closer and a stadium needs filling. Shapiro et al. (2016) found, among other
things, that consumer perception of ticket pricing is time-dependent.

Step 8: Determine final price

Throughout this chapter, it has been shown that many factors affect the pricing
process of a certain product. Figure 6.5 summarises these factors, and shows how
the possible pricing range of the product narrows after taking the influence of
these various factors into consideration.

Figure 6.5 Possible pricing range.

Final price determination is based on cost, competition or demand, or a

combination of all three. Most of the time one method provides the basis for
decision-making, although the others often contribute. As shown in this chapter,
cost-based price determination proves to be more difficult for service-based sport
products. The break-even analysis has been presented as a cost-based approach.
Many providers in the health and fitness industry will base their pricing on
competition as in this industry it is important to fill the capacity of the facility,
and thus attract those few extra customers from direct competitors. It is likely that
the larger spectator sport organisations base their pricing on demand. In this
method, the value of the product to the buyer is estimated.
In this chapter’s opening example, the state government of Victoria and the
bidding organisation (then the Victorian Major Events Company, which is now
part of Visit Victoria) will have estimated the value of the television product to
the broadcast network; the sponsor product to the sponsors; and the economic,
social and cultural value of the Grand Prix event to the host community. It can be
concluded that, ultimately, the AFL based its pricing strategy on the perceived
value of its total product mix. Along similar lines, the price charged by the Grand
Prix organisers for tickets makes up only a small component of the overall pricing
equation. The final price charged by the organisers includes a significant tax
contribution by the local residents of Melbourne and Victoria, not to mention a
range of environmental costs. Overall, the ‘final price’ paid for the right to host
the event is a function of the range of benefits – both tangible (economic) and
intangible (social and cultural) – that the event is able to generate.

Summary
In this chapter price, as one of the variables of the marketing mix, was discussed
in the context of setting or adjusting the price of a sport product. In order to arrive
at a final price, a strategic pricing model was introduced. To enable the sport
marketer to set appropriate prices, it is important to set pricing goals in concert
with the overall organisational and marketing goals. Then the sensitivity of
markets to changes in price can be determined and, as a consequence, the
elasticity of demand established. This information, combined with marketing data
such as the size of the market and the number of competitors, is used to estimate
cost–volume–profit relationships, leading to the creation of a break-even chart
with an emphasis on a cost-based pricing strategy. When the organisation is able
to base its pricing on the demand in the market – in other words, when this is
powerful enough to lead the way in setting price – the emphasis will be on
demand-based pricing. It may, however, be more important to find out about the
pricing strategies of competitors and to determine constraints (legal, social, other
marketing mix variables) on pricing behaviour in the industry. This can lead to a
competitor-based pricing strategy. When taking into consideration the time-
dependence of many sport products, a combination of cost-based, demand-based
and competitor-based pricing will often be exercised in setting the final price or
adjusting the current price.
CASE STUDY
The impact of star players on demand for sports
Nader Chmait and Hans Westerbeek
Fan engagement is one of the major targets of professional sport (event)
organisations since much of their income relies on consumer demand for their
products and services. Sport stars tend to have a positive impact on audience
sport-event consumption (Lewis & Yoon, 2016). Examples of the superstardom
phenomenon in sports include:

The signing of David Beckham, which drove higher attendance figures in

US Major League Soccer (Jewell, 2017).
The substantially higher television ratings (and stadium attendance) in
NBA games featuring superstar Michael Jordan compared to other games
featuring lower-profile all-star players. In fact, it was estimated that
Jordan’s economic value (incremental revenue) for other NBA teams
reached US$53 million for the 1991–92 season (Hausman & Leonard,
1997).
High-profile cricket players who are centrally contracted to the national
side have been reported to drive considerably higher attendance figures at
one-day games (Paton & Cooke, 2005).

It is now obvious that ticket pricing elasticities can be more appropriately

managed once we factor in the likeability of players or teams (Drayer et al.,
2012). Variable ticket pricing has been successfully implemented in different
sports, whereby athletes swing admission prices according to their popularity
with and appeal to the spectators (Rascher et al., 2007). Chmait et al. (2019)
measured the influence of star status on match attendance in tennis. Similar to
the findings in the team sport literature (Hausman & Leonard, 1997; Paton &
Cooke, 2005; Ormiston, 2014; Lewis & Yoon, 2016), they show that there are
additional stardom effects that should be accounted for when examining
demand for tickets in tennis and, eventually, when such events are priced. For
instance, the study identified players having a positive effect (after-draw
release) on ticket sales at the Australian Open (AO) tournament.
All-time star Roger Federer stood out as the player having the utmost impact
on attendance at the AO. Novak Djokovic, Rafael Nadal, Kei Nishikori and
Andy Murray are also among the superstars who demonstrated a significant
positive relationship to ticket sales for the Open, driving higher stadium
attendance. Nick Kyrgios appeared to have had the largest onsite value among
the considered Australian players. This illustrates that star status extends
beyond an athlete’s talent or career success that is estimated by their Elo ratings
and top ATP rankings (Chmait et al., 2019).
In other words, whenever a pricing strategy is to be devised by a sports
organisation, it is crucial to factor in player (stardom) influence on attendance.
The same analogy applies to the relationship between superstars and fans’
consumption of the sport on social media platforms. Sports fans engage with
their favourite sports in numerous ways, from playing sport, physically
attending events, watching the sport on live television or directly interacting
with their favourite sport and players on social media. Social media is thus a
valuable window to quantify the economic value of star athletes, and it is
usually much more accessible to the public in comparison to ticket sales data,
which tend to be proprietary and rarely shared.
After studying social media mentions of 88 professional players who
participated in the 2019 Australia Open, Chmait et al. (2020) showed that 17 of
those players had a significant positive impact on social media engagement
around the Australian Open timespan, with Federer again topping the list.
Serena Williams was the most engaging professional female player during the
2019 tournament by driving the highest volume of social media mentions. The
top ATP-ranked player at the time, Novak Djokovic, was the sixth most
influential player on social media based on social mentions’ volume activity.
Maria Sharapova, a popular figure in the media, ranked among the top 10 most
influential players despite her relatively low WTA ranking (of 30) at the time.
Nick Kyrgios was the only Australian player to have shown a significant effect
on social media mentions.

Questions
1. Describe how you would use your knowledge of star players when
pursuing a revenue maximisation strategy?
2. How would this change if you were to pursue a profit maximisation
strategy?
3. Considering the concept of price elasticity of demand, explain how this
applies to having the top player in the world in your tournament draw.
4. What will change in your pricing strategy if the highest ranked player in
your draw is number 20 in the world?
5. You are the organiser of a WTA tournament. Explain how you would use
knowledge of the impact of players on social media engagement in your
decision to pay appearance fees to certain players.
References
Australian Grand Prix Corporation. (2019). 2019 annual report.
https://lp.grandprix.com.au/rs/014-JWG-
984/images/AGPC_Annual_Report_Combined_2019.pdf.
Bertini, M., & Gourville, J.T. (2012, June). Pricing to create shared value,
Harvard Business Review. https://hbr.org/2012/06/pricing-to-create-shared-
value.
Cameron, S. (2002, 27 May). Bruins to set prices hourly. Sports Business
Journal.
https://www.sportsbusinessjournal.com/Journal/Issues/2002/05/27/This-
Weeks-Issue/Bruins-To-Set-Prices-Hourly.aspx.
Chmait, N., Robertson, S., Westerbeek, H., Eime, R., Sellitto, C., & Reid, M.
(2019). Tennis superstars: The relationship between star status and demand
for tickets. Sport Management Review, 23(2), 330–347.
https://doi.org/10.1016/j.smr.2019.03.006.
Chmait, N., Westerbeek, H., Eime, R., Robertson, S., Sellitto, C., & Reid, M.
(2020). Tennis influencers: The player effect on social media engagement
and demand for tournament attendance. Telematics and Informatics, 50,
101381. https://doi.org/10.1016/j.tele.2020.101381.
Drayer, J., Rascher, D.A., & McEvoy, C.D. (2012). An examination of
underlying consumer demand and sport pricing using secondary market data.
Sport Management Review, 15(4), 448–460. doi:10.1016/j.smr.2012.03.005.
Drayer, J., Shapiro, S.L., & Lee, S. (2012). Dynamic ticket pricing in sport:
An agenda for research and practice. Sport Marketing Quarterly, 21(3), 184–
194.
Dwyer, L., Forsyth, P., & Dwyer, W. (2020). Tourism economics and policy
(2nd edn). Bristol: Channel View.
Economists at Large (2013). Blowout! A cost benefit analysis of the
Australian Grand Prix, a report for Save Albert Park, prepared by
Economists at Large, Melbourne, Australia.
Harris, J. (2018). Diversification of revenue streams at Australian sporting
clubs. https://www.sriexecutive.com/wp-content/uploads/2018/09/Australia-
revenue-streams-report-JH-Final.pdf.
Hausman, J.A., & Leonard, G.K. (1997). Superstars in the National
Basketball Association: Economic value and policy. Journal of Labor
Economics, 15(4), 586–624.
Jewell, R.T. (2017). The effect of marquee players on sports demand: The
case of US Major League Soccer. Journal of Sports Economics, 18(3), 239–
252. doi:10.1177/1527002514567922.
Kahn, B. (2011, March 21). Forty under 40. SportsBusiness Journal.
http://www.sportsbusinessdaily.com/Journal/Issues/2011/03/21/Forty-Under-
40/Barry-Kahn.aspx.
Kavakos, S., & Calver, C. (2021, June 29). These are some of the most
expensive sporting tickets of all time. GQ.
http://www.gq.com.au/fitness/sport/these-are-some-of-the-most-expensive-
sporting-tickets-of-all-time/image-
gallery/cedae05ea0833a234aa1e7a43f948713.
Kimes, S.E. (2003). Revenue management: A retrospective. Cornell Hotel
and Restaurant Administration Quarterly, 44(5–6), 131–138.
Kleyn, B. (2020, March 13). Sports clubs accused of pricing families out of
local competitions after charging thousands of dollars in fees. ABC News.
https://www.abc.net.au/news/2020-03-14/sport-club-costs-a-barrier-for-
families/12045812.
Kobritz, J., & Palmer, S. (2011). Dynamic pricing: The next frontier in the
evolution of ticket pricing in sports. Review of Management Innovation and
Creativity, 4(9), 118–130.
Koop, C. (2020, March 19) Cherry-pit spitting and marble races? ESPN is
airing obscure sports amid coronavirus. Miami
Herald.https://www.miamiherald.com/news/coronavirus/article241342376.ht
ml.
Lewis, M., & Yoon, Y. (2016). An empirical examination of the
development and impact of star power in Major League Baseball. Journal of
Sports Economics, 19(2), 155–187.
McCarson, K. (2014, September 11). Floyd Mayweather vs Marco Maidana:
Is boxing pricing out its biggest fans? Bleacher Report.
http://bleacherreport.com/articles/2194389-floyd-mayweather-vs-marco-
maidana-is-boxing-pricing-out-its-biggest-fans.
McNair-Connolly, C.J., & Merchant, K.A. (2020). Management accounting:
An integrative approach (2nd edn). Wiley, Montvale, NJ.
Ormiston, R. (2014). Attendance effects of star pitchers in major league
baseball. Journal of Sports Economics, 15(4), 338–364.
Paton, D., & Cooke, A. (2005). Attendance at county cricket: An economic
analysis. Journal of Sports Economics, 6(1), 24–45.
Paul, R.J., & Weinbach, A.P. (2013). Determinants of dynamic pricing
premiums in Major League Baseball. Sport Marketing Quarterly, 22(3),
152–165.
Rascher, D.A., McEvoy, C.D., Nagel, M.S., & Brown, M.T. (2007). Variable
ticket pricing in Major League Baseball. Journal of Sport Management,
21(3), 407–437.
Shapiro, S.L., & Drayer, J. (2012). A new age of demand-based pricing: An
examination of dynamic ticket pricing and secondary market prices in Major
League Baseball. Journal of Sport Management, 26(6), 532–546.
Shapiro, S.L., & Drayer, J. (2014). An examination of dynamic ticket pricing
and secondary market price determinants in Major League Baseball. Sport
Management Review, 17(2), 145–159. doi:10.1016/j.smr.2013.05.002.
Shapiro, S.L., Drayer, J., & Dwyer, B. (2016). Examining consumer
perceptions of demand-based ticket pricing in sport. Sport Marketing
Quarterly, 25(1), 34–46.
Singh, R., Muller, G., & Buskirk, D. (2014). An analytics-based pricing
strategy for sport franchises: Maximize revenue and enhance fan experience
through analytics. Deloitte Consulting LLP, London.
TWG Staff (2019, October 29). Ticket sales are vital to AFLW equity. The
Women’s Game. https://thewomensgame.com/news/ticket-sales-are-vital-to-
aflw-equity-533122.
Wright, C. (2014, September 17). Rio 2016 Olympic Games organisers
unveil ‘affordable’ tickets. Sydney Morning Herald.
https://www.smh.com.au/sport/rio-2016-olympic-games-organisers-unveil-
affordable-tickets-20140917-10hxs5.html.
CHAPTER 7

The sport place

DOI: 10.4324/9781003270522-10

Chapter objectives
Chapter 7 introduces the facility as the most important means by which sport
services are distributed. Place as an element of the marketing mix is discussed
in terms of preparing for and delivering quality service to visitors to the facility
or venue. Where to focus attention in relation to preparation for the sporting
contest (planning and physical evidence) and actual delivery (people and
process) are the central concepts discussed in this chapter. The practice of
blueprinting is introduced to assist in this analysis, supported by frameworks to
understand the role of the sportscape variables and the servuction processes.
The chapter also examines different channels of distribution in sport.
After studying this chapter, you should be able to:

identify the critical elements of the sportscape model

identify and apply the four variable components of place
create a blueprint of how a sport product is delivered
identify the marketing channels through which sport products can be
delivered.

Headline story
Venues for now and the future
The regeneration of East London was a central component of the legacy of the
2012 Olympic Games. East London suffered from long-standing problems of
multiple deprivation, and as a result was historically one of the poorest parts of
the United Kingdom, struggling to keep pace with many of the socio-economic
advances experienced elsewhere in London. The Games provided a unique
opportunity to tackle these issues, and as such the focus was placed on:

ensuring that the Olympic Park could be developed after the Games as one
of the principal drivers of regeneration in East London, maximising the
investment in venues, infrastructure, utilities and the environment
securing a socio-economic legacy from the Games in the host boroughs so
that, ‘within 20 years, the communities which host the 2012 Olympic and
Paralympic Games will enjoy the same social and economic chances as
their neighbours across London’ (Grant Thornton, 2012).

London successfully bid for the event in Singapore in 2005, based on a vision to
‘Inspire a Generation’, and as such was heavily dependent on sustainability and
legacy themes. For London and the UK as a whole, the Olympics served as a
tool to reach an aspirational future as much as being a global hallmark event.
 Even more visionary and transformational are the plans put forward by the
Los Angeles 2028 Committee and the City of Los Angeles. Los Angeles Mayor
Eric Garcetti even boasted that ‘we could do the Olympics probably two months
from now’, in order to explain how most facilities that are required to host the
Games are already there. Having organised the Olympic Games twice already,
they will now be truly used as an accelerator of wide-ranging urban
transformation efforts in and around Los Angeles. Doubling the size of the mass
transportation network and expanding LA International airport are just two of
‘28 by 2028’ projects that have been targeted to be completed by the time the
Olympic Games come to town (Pacheco, 2019). Planning for the sport-specific
requirements and upholding the promises for future needs of sport facilities and
sport precincts are important in the strategic sport marketing process.

Place as a sport marketing component

In Chapter 1, place as an element of the marketing mix was described as
distributing the product to the right place at the right time to allow ease of
purchase. A unique characteristic of the sport distribution system was described,
in that sports generally do not physically distribute their products. Most sport
products are simultaneously produced, delivered and consumed at the one
location, at one point in time. The exceptions are sporting goods and broadcast
sport. Given this characteristic of the sport-distribution system, the sport venue or
facility becomes the most important element in the distribution strategy of the
sporting organisation. In other words, the place variable in the marketing mix for
sport activities, be it elite or community sport, is the sport facility.
By manipulating the elements of the marketing mix into varying combinations,
different marketing strategies can be created. That is, the sport marketer will use
the place variable differently for one group of customers compared to another
group of customers. To be able to do this, it is necessary to identify the variable
components of the marketing mix element of place. It is no coincidence that the
last three of these variable elements of place are also elements of the services
marketing mix. The variable components of place are:

facility planning
physical evidence
process
people.
The variable components are presented in Figure 7.1 and are discussed in more
detail in following sections of this chapter. The variables are presented in the
sequence shown in Figure 7.1 because decisions made at a higher level (such as
facility planning) dictate decisions at the lower levels.

Figure 7.1 Variable components of place.

After identifying the variable components of place, bringing them together in an

integrated fashion becomes the primary task of the sport marketer, which will be
the topic of the next section. Where and when to interfere and exert influence can
be mapped out in a blueprint, or overview, of the sport service delivery system.
The chapter finishes with a discussion of more traditional distribution systems,
mainly used to distribute sporting goods but, as a conceptual model, also
applicable to sport service products.
Sport as a service product is briefly discussed in Chapter 5, and is covered
more extensively in Chapter 9. But in order to fully appreciate the variable
components of the (sport) place, a closer look at what makes up the sport facility
– or ‘sportscape’ – is justified. We can define the service environment in and
around the stadium or the community sports centre as the sportscape. A
considerable amount of research has been conducted into the influence of the
fixed elements of the ‘servicescape’ – that is, those elements that remain the same
from game to game (Wakefield & Sloan, 1995; Wakefield & Blodgett, 1994,
1996; Wakefield et al., 1996; Lambrecht et al., 2009; Hill & Green, 2012). These
elements include facility layout accessibility, aesthetics, seating comfort,
electronic equipment and displays, and cleanliness.
The study by Wakefield et al. (1996) found that layout accessibility, aesthetics,
seating comfort, electronic equipment and displays, and cleanliness all have a
significant influence on how sport fans perceive the quality of the stadium. In
turn, the higher this perceived quality of the sportscape is, the higher the sport
fan’s satisfaction with the sportscape will be. If sport fans are more satisfied, they
are likely to stay in the stadium for a longer period (and spend more money); also,
they are likely to return more often. De Carvalho et al. (2015) support this claim,
and add team identification to the mix when understanding the sportscape. They
argue that the more the facility is positively evaluated, the more likely people will
follow their team at that facility. These relationships between the sport fan’s
behavioural intentions and the sportscape are presented in Figure 7.2.

Figure 7.2 Sportscape model. Source: Adjusted from Wakefield &

Blodgett (1996, p. 46).

Beyond the sportscape that is specifically designed for spectator sport are those
that people use to play sport or engage in exercise for their own pleasure and
benefit. Although similar principles apply, it pays to consider some recent
research. Lee (2017) found that the level of service quality in sports centres
positively influences both customer loyalty and their intention to adhere to
exercise. Lee used ‘quality of facilities’ and ‘quality of instruction’ as the
subfactors that define service quality. Lee also found that with increased customer
loyalty, the intention of adhere to exercise also increased. In other words, much
like the facilities designed for spectator sport, community sports centres are also
more successful places of sport consumption when the facilities and staff service
on offer are of high(er) quality.
Now that we have established the importance of the inanimate and permanent
structure that is the sport facility, and its impact on sport fans’ and users’ response
to the distribution of sport products, it is time to introduce the first variable
element of place. The case study looking at the London Olympic Games at the
start of this chapter further serves as an example of the first important
consideration pertaining to planning the sport distribution system: facility
planning.
Facility planning
Planning of facilities for mega-events like the Olympic Games, or facilities for a
professional basketball club or the local community sports centre, should involve
a long-term perspective of the prospective usage of the facility. With production
and consumption of the sport products taking place in the facility, both current
and future provisions need to be taken into consideration. It is extremely costly to
redevelop and redesign existing facilities. Figure 7.2 also shows that those
elements that directly derive from how we plan for the development of the facility
affect the purchase behaviour of sport consumers. In that regard, does the sport
facility as it currently is significantly determine opportunities and limitations for
sport product provision? For example, due to its size and design, the Olympic
Park rectangular (football) stadium in Melbourne is not able to host a cricket or
Australian Rules football match. The physical conditions of Olympic Park (poor
drainage, flooding and limited seating) meant the facility was below standard for
staging elite events. As a result, the state government of Victoria, in conjunction
with the Melbourne and Olympic Parks Trust, redeveloped Olympic Park at a cost
of A$268 million as AAMI Park, a purpose-built rectangular stadium. The
stadium was perceived to be the ‘missing link in Melbourne’s sport
infrastructure’. The Johan Cruijff Arena (formerly Amsterdam ArenA) in the
Netherlands, on the other hand, can host soccer matches at any time of the year.
Opened in 1996, it was the world’s first ‘real grass’ soccer stadium with a
retractable roof. Excessive rainfall is therefore not a potential limitation. Since the
opening of the arena, other sport providers have followed suit. For example,
Marvel Stadium in Melbourne has a retractable roof, allowing for soccer, ‘indoor’
cricket, National Rugby League (NRL) and Australian Football League (AFL)
matches through its unique Australian design. It must be noted that the
Amsterdam’s arena in particular has had problems ensuring that the ‘real grass’
playing surface is of sufficient quality (due to limited daylight exposure) for
premier league soccer matches. This just shows that when you plan to solve one
problem, another may arise.
Many sporting arenas around the world were originally developed and built to
host sporting events and enable a certain number of spectators to watch the game.
Few of the older arenas, however, were built to host guests in corporate boxes.
With many sporting organisations dependent on corporate dollars, an old stadium
can become a severe competitive disadvantage. In other words, the ability to cater
for a range of sport products is highly dependent on the planning and design of
the sport facility. The state of Victoria in Australia proudly communicates its
building of a wide range of international standard stadiums and sport facilities for
horse racing, tennis, football (all codes), basketball, cricket, netball and the
Commonwealth Games, with the intention of attracting more sports fans and
revenues to the city. Sportview 7.1 further discusses the importance of the sport
facility and its physical environment.

SPORTVIEW 7.1
The importance of physical and technological infrastructure of the
sportscape for repeat sport participation and visitation
In the case of leisure services, it is more than just the perceived quality of the
service rendered (such as whether a meal was delivered in a timely fashion) that
influences whether consumers are satisfied with the service experience. For
example, the purpose of going to an amusement park, a theatre or a sporting
event would seem to be for the excitement and stimulation of the experience.
This kind of situation differs from a trip to the dry-cleaner, in which the
customer is not likely to have any expectation of emotional arousal.
Because the sport product is generally purchased and consumed
simultaneously, and typically requires direct human contact, customers and
employees interact with each other within the organisation’s physical facility.
Ideally, therefore, the organisation’s environment should support the needs and
preferences of both service employees and customers simultaneously. Even
before purchase, consumers commonly look for cues about the organisation’s
capabilities and quality. The physical environment is rich in such cues, and may
be very influential in communicating the organisation’s image and purpose to its
customers. This was true in the past, but is even more so in the present when
digital technologies and augmented reality applications allow for the
presentation of physical venues in a variety of ways – prior to visiting and also
during the visit.
Jang et al. (2020) extended the traditional sportscape model by including
emotions and behaviours of attendees at four US-based major leagues. Beyond
the spatial layout and functionality of the facility, and the elements related to
aesthetic appeal, the authors add that positive emotional and behavioural
intentions of sport fans can boost attendances at facilities through the strategic
use of sportscape elements. The ways in which seats, aisles, hallways and
walkways, food-service lines, restrooms, and entrances and exits are designed
and arranged influence fan comfort, while the external environment, the
architectural design, facility upkeep and cleanliness, use of decorative banners
and signs, and personnel appearance all influence the ambience of the place.
Beyond the ‘hard’ infrastructure environment, sport fans increasingly engage
 with each other and with the spectacle through purpose-designed apps on their
smartphone, or augmented or virtual reality technology on offer by the event
organisers. Spectator sport venues and health and fitness centres alike have also
become ‘smart’, with Wi-Fi, sensor and tracking technology providing useful
management- and customer-directed information and insights. Providing such
information and insights will not only enhance the entertainment and
engagement value but will also contribute to safety and security measures as
important sub-dimensions of customer satisfaction. Stadiums and fitness centres
are not in competition with other stadiums or centres as such, but in competition
with people who would seriously consider staying at home. Ioannou and
Bakirtzoglou (2016) and Oman, Pepur and Arnerić (2016) also noted that
respondents who felt crowded were less excited about the servicescape and
perceived the servicescape to be of lower quality.
These research findings have direct implications for those who have
investments in stadium projects, especially in post-COVID times. A return on
investment from increased gate receipts or membership fees might be expected
on the back of building new stadiums or following renovations. More spacious,
smart, technology-integrated stadiums and community fitness centres will be the
norm, not the exception, if people are still to attend venues to watch others play
sport or, indeed, engage in their own physical activities.

Additional sources: Bitner (1992); Wakefield & Blodgett (1994).

Based on extensive market research, economic trend analysis and environmental

scanning, the sport marketer can determine current demand and predict future
customer needs. This should lead to market information on which specialists such
as the architect and the engineer can base their sport facility planning and
construction. If the sport marketer can influence facility location, design and
construction decisions, the place variable will be optimised in terms of facility
opportunities. It should be noted, though, that many sport marketers have to work
with existing sport facilities. Nevertheless, identification of the service provision
opportunities and limitations of the facility remains a task to be performed by the
sport marketer in order to move on to the next step: supplying physical evidence.

Physical evidence
As described in Chapter 1, the sport product itself is intangible and subjective,
making it harder for the sport marketer to sell the sport product as a commodity,
standardised in quality and physical shape. Hogg and Gabbott (2013) reacquaint
the reader with the three major areas of concern that customers face when
purchasing services, as originally identified by Legg and Baker (1987):

understanding the service offering

identifying the evoked set of potential service providers, and
evaluating the service before, during and after purchase.

Stated differently, it is hard for the customer to judge the quality of the product
and then compare it with other products (providers) to arrive at a final purchase
decision. If the sport marketer is able to make the sport product more tangible for
the customer prior to purchase, the customer is more likely to buy it. Physical
representation, if unique and attractive, can ‘tangilise’ the facility, giving it brand
identity and inducing strong mental images (Mittal, 2002). Hence the sport
marketer has to provide the sport product with physical evidence.
Physical evidence should support the quality characteristics of the product
because the majority of customers will judge the product on its quality. Physical
evidence can be enhanced by optimising:

sport facility design

‘virtual’ walkthroughs of the facility
online marketing and social media groupings/discussions, linking
participants to a venue
promotional material and advertising, and
service provision (discussed below).

The sport facility

The sport facility is the most tangible and visible physical evidence sport
marketers can have for their products. The name of the facility can be displayed
and marketed as the place where exciting events occur. The FA Cup Final at
Wembley, the AFL Grand Final at the Melbourne Cricket Ground and the
National Basketball Association (NBA) playoffs at Madison Square Garden are
all examples of events growing in their perceived quality in combination with the
respective venues. Who would get excited about the FA Cup Final at Norwich
City’s football ground, the AFL Grand Final at Bendigo football oval or the NBA
playoffs at Florida Southern College basketball stadium?
 High-tech interactive scoreboards showing instant replays, and fan
engagement and the provision of social media or stadium app-driven sports trivia
enhance the tangibility of the event (and hence the perceived quality of the
sportscape, as shown in Figure 7.2). In addition, banners, photographs or statues
of sporting heroes can decorate the outside and inner walkways of the facility. For
example, portraits of all past Australian Open tennis champions decorate the
inside walkways of Melbourne Park. Video or television screens, trophy
exhibitions and interactive displays can show (and make fans relive) famous
moments of success of the teams playing in the facility. Many stadiums around
the world have incorporated sport or club museums in their facilities. More
recently, the application of games technology with content management has
added a new dimension in displaying digital interactive multimedia in those
museums and to any output screen around the facility, further enhancing the
ability to involve the public in the active imagery of sport organisation history.

Promotion
Because of the intangibility of the sport product, promotion is another way to add
to the physical evidence. Adding this physical evidence is not specific to
distribution through the facility, and examples are therefore not necessarily linked
to facility. The quality image and brand name of a sporting organisation can be
enhanced through either advertising or promotion, distributed among potential
customers or by direct mail or social media to selected markets. Any marketer
worth their salt would suggest that advertisements should be vivid, using relevant
tangible objects, concrete language and/or dramatisation. Photographs of past
events, listings of services and explanations of different product offerings will
materialise intangible services offered by the organisation. Multi (social) media
channels are another important consideration. Satisfied customers prepared to
participate in these promotions can be used to endorse the different products,
communicating their satisfaction. Celebrities, including star athletes, can also be
used in this process as an influential and forceful communication channel. As
noted in the previous chapter, the star quality of certain athletes can significantly
boost consumer interest in events hosted in the stadium environment. In 2006 the
US National Football League’s (NFL) Miami Dolphins was one of the first sports
teams to introduce technology into the stadium for their fans. This enabled each
fan to view network broadcasts of Dolphins games and fantasy statistics while at
the stadium ‘to improve the fan experience’ (Dolphin Stadium, 2006). This
opened the door for sport organisations to embrace digital technologies as an
augmentation to the ‘live’ spectator experience. It is now the norm in major sports
facilities, such as Real Madrid’s Santiago Bernabéu Stadium, to have high-speed
wireless network capability to allow for the fans’ second screen (mobile, tablet,
laptop) to engage in a personalised ‘fan experience’ and deliver other live scores,
replays and statistics. As noted earlier, virtual- and augmented-reality technology
is the next-generation digital progression to engage with sport fans. Digitising the
sport stadium, entertainment and atmosphere is now a priority function of
delivering the definitive sport experience. The 2018 FIFA World Cup used social
media effectively to engage billions of fans worldwide through temporary selfie-
filters and other augmented-reality tools. These developments are only scratching
the surface of possible transformations for stadium management to embrace. The
new Tottenham Hotspur Stadium in London (opened 2019) has brought in
scalable wireless infrastructure to enhance the facility’s life expectancy for
decades to come.
Irrespective of the media channel used, the sporting organisation should try to
link pictorial (posters, merchandise, advertisements) and written physical
evidence (brochures, flyers, advertisements) to the name of the organisation.
Licensing strategies (team merchandise) used by the Los Angeles Lakers, Cricket
Australia (CA) and Manchester United Football Club are excellent examples of
sporting organisations adding to their physical evidence and making money with
their marketing promotions. These organisations also show that the fit between
the name of the organisation and physical evidence is very important when
considering a licensing and merchandising strategy. This topic is discussed in
Chapter 5.

Process
So far, only the variables that can be manipulated when preparing for the
customer to come to the facility to buy and consume the product have been
discussed. Purchase and consumption involve the process by which the sporting
organisation actually distributes the product to the customer. Sport marketers
heavily involved in this sport service delivery process can influence and optimise
the contacts between the customer and the sporting organisation. Westerbeek and
Shilbury (2003) recognise the importance of convergence of the marketing and
operating functions of sport facility.

The marketing function

Grönroos (1990) distinguishes between the marketing department and the
marketing function of an organisation. In traditional consumer goods marketing,
the marketing department is the unit responsible for planning and implementing
marketing activities. Deciding on how to market a can of beans is almost the sole
responsibility of the marketing department of the manufacturer; the retailer has
only to put it on the shelf and sell it.
In a service economy, however, marketing activities (delivering the service as
opposed to selling the beans) cannot be taken care of solely by the marketing
department. Contacts between the service provider (for example, the basketball
club) and the customer are so important in terms of overall customer satisfaction
that marketing activities have to be carried out by the whole organisation, not
only the marketing department. Ushers and food and beverage sellers are
producing and delivering parts of the overall service package, and can be
identified as ‘part-time marketers’. They belong to what Grönroos (1990, p. 177)
defines as the marketing function, ‘including all resources and activities that have
a direct or even indirect impact on the establishment, maintenance, and
strengthening of customer relationships, irrespective of where in the organisation
they are’.

Sport servuction model

The process by which the overall package of services is planned, produced and
delivered to the customer can best be explained with the help of the sport
servuction model shown in Figure 7.3. This model will be explained further by
using service delivery at a basketball match as an example. The term ‘servuction’
refers to the visible production and delivery of the service experience.
 Figure 7.3 The sport servuction system. Source: Adjusted from
Langeard et al. (1981). Reprinted with permission of publisher.

The sport servuction system model portrays the invisible and visible parts of the
organisation. In the invisible part, facility management and the two basketball
clubs’ managements combine to organise and plan for game night. This can be
classified as the traditional marketing department role. The visible part of the
organisation consists of the facility itself, the inanimate environment (physical
evidence) and the service providers (contact people). The importance of the
inanimate environment was described earlier in this chapter. Contact people –
ticket sellers, ushers, and food and beverage sellers, but also the basketball
players – provide the different services to the customers. This accumulation of
services represents the customer’s overall perception of their interaction with
other customers, facility staff and players.
It is in the invisible part of the organisation that managers put together the
service delivery process. Questions about issues like where merchandising stands
are located, how many ticket sellers and ushers are needed, how ticket sellers and
ushers are expected to approach customers, or how many food and beverage
stands will be operated are asked in the cause of optimising the service-delivery
process. Digital data-collection technology about customer movements has
greatly enhanced the ability of facility planners to make such decisions. Later in
this chapter, the sport service-delivery system is blueprinted based on the sport
servuction system model. First, however, it is necessary to include people as the
final variable component of place.

People
Staff are responsible for the delivery of the product, and as a consequence are the
main distinguishing quality factor in the consumption process. The outcome of a
basketball game cannot be guaranteed; therefore, consistency in service delivery
is of the utmost importance in determining a customer’s overall perception of the
quality of the sport product. In Chapter 10 five criteria that customers use to
evaluate service quality are discussed further. These are:

tangibles
reliability
responsiveness
assurance, and
empathy.
These five criteria show the importance of marketing function personnel in the
delivery of quality service. Apart from tangibles (partly personnel) and security,
all the criteria are fully dependent on the training, skills and abilities of people in
delivering high levels of service quality. The selection and training of human
resources for service delivery in sport are tasks in which the sport marketer
should have strong involvement. The level of training, skills and abilities of
potential employees of the sporting organisation become ‘people variables’ that
will make the difference between mediocre and excellent service provision.

SPORTVIEW 7.2
Post-2020 pandemic: the blueprint for recovery in sport stadiums
Lynley Ingerson
In early 2020 sport facilities were placed in lockdown due to the global
COVID-19 pandemic. Competitions were cancelled, players were forbidden to
compete in any sport that required contact and spectators were banned from
entering sport facilities. By mid-2020, as pandemic conditions tapered, sport
facility managers began the process of creating strategies to support the
reintroduction of competitive sport. The focus from there was on facility
cleanliness and hygiene, including all surfaces that were touched, sat on or
passed through. Facility managers had to consider crowd limits and social
(physical) distancing as part of their safety strategy. Systems to check the
temperature of all attendees (staff, fans and players) prior to entering the
stadium were considered as part of normal practice; and consideration of
medical advice has also become an important aspect of decision making for
managing events at facilities.
The global sport shutdown has had enormous implications for delivering and
experiencing the sport product in and around facilities. Initially some sports
bodies, such as football and basketball, locked spectators out of league
competitions in an attempt to resume seasons and maintain televised events.
Other sports, such as outdoor netball or swimming, had their competitions
delayed further. In Australia, junior and elite sport training was the first sector
allowed to return to post-pandemic regimes, followed by adult community-level
competition. Much of the decision making around when and where sport could
be delivered depended upon government intervention and the nature of the sport
product.
However, knock-on effects were initially ill-considered. In Australia the
winter sport season (Australian Rules football, basketball and netball) affects
the traditional commencement date of summer sports (cricket and soccer) and
shared use of multi-sport facilities. AFL and NRL seasons aimed to complete in
late October, but this overlapped with scheduled T20 cricket and other state-
based competitions. Preparing facilities for a quick turnaround creates
additional problems for the facility manager. World events such as the 2020
Tokyo Olympic Games, marathons, Grand Slam tennis, Formula 1 and golf
have suffered from both financial and operational repercussions of a disruptive
game changer such as the pandemic. It is estimated the postponement of the
Tokyo Olympics until 2021 would incur a loss of US$6 billion and the US
Major Leagues a loss of US$5 billion (Aljazeera.com, 2020).
In Australia, the strategy to reignite sport competition has been a cautious
process, with facility managers testing one sport after another for the impact of
crowds to venues, on-field contact and management of the entire competition.
Stadiums have been designed to use every bit of spectator space as seating; but
the managers now need to look at ensuring that there is sufficient social
distance, which effectively means they have to reduce capacity. Boutique
stadiums such as the Adelaide Oval, where open grassed areas exist, are able to
spread the crowd out more easily. As mentioned below, in June 2020 football
resumed in Vietnam’s V-League in a match that entertained 10,000 spectators,
which is about a third of the stadium’s capacity. The South Australian
government approved the Adelaide Crows and Port Power AFL showdown
game in June 2020 but only allowed 2250 spectators in the 55,000-seat
Adelaide Stadium venue.
In order for competitions to resume safely and for the pandemic to be kept at
bay, clear, relevant and precise communication by sport organisations and
facility management was and remains paramount. Trust between facility
management, medical advisors, government decision makers and other
stakeholders in sport is necessary if sport competitions are to remain safe. Fans
and ground staff in particular need reassurance that they will not be vulnerable
at a facility. Research on the connection between sportscape factors and fan
experience highlights the necessity for cleanliness and safety (Ioannou &
Bakirtzoglou, 2016; de Carvalho et al., 2015).
Galante (2020) proposes seven areas to consider for future facility
management, including: planning for future exposure; monitoring and managing
entry requirements; regular infection-control supplies and cleaning; control of
refrigeration, air conditioning and heating services; integrating supply-chain and
third-party needs and wants; supporting the well-being of customer contact,
cleaning and maintenance staff; and capitalising on down-time for deep-clean
practices. Rethinking the business plan and devising a ‘new’ blueprint for
 managing facilities post-pandemic are the next steps in uniting sport fans and
sport competitions.

Additional source: Jang et al. (2020).

Blueprinting the sport service delivery system

Having identified the four variable components of the marketing mix element
place, and knowing how one component can be varied independently from the
other components, the sport marketer can start looking at how to combine the
different components in an integrated fashion. By identifying operations (service
preparation and service delivery) within the physical design of the sport facility, it
is possible to create an overview or blueprint of the sport service delivery system.
The blueprinted sport service delivery system will incorporate the four variable
components of place. It is now up to the sport marketer to create the right mix of
what is to be produced and consumed in the system.
Figure 7.4 displays a blueprint of the sport service delivery system for a
basketball match. It follows the flow of customers through the facility, and
identifies different parts of the sport facility where interactions between the
customer and facility personnel take place. It needs to be noted that it is
nowadays quite easy to ‘track’ consumer movements upon entering the facility.
All that’s needed is for visitors to carry a smartphone and use the facility’s Wi-Fi
system. This will provide valuable data that can go towards creating the ultimate
customer blueprint. The accumulation of (all of the customers’) interactions
contributes to the overall service experience of both individual customers and all
of them as a collective. Since 2020, the sport service blueprint must concentrate
even more on safety and hygiene needs for all stakeholders at an event staged in
closed facilities. As mentioned earlier, most sport facilities shut down in 2020
because of the COVID-19 pandemic. One of the first sports in Southeast Asia to
resume was the V-League (football) in Vietnam. With no pandemic deaths
recorded in the country, the Vietnamese Cup resumed at the Thien Truong
Stadium with a half-capacity crowd of 10,000 spectators (Nguyen, 2020). Other
nations in the region slowly reintroduced events at sport facilities and devised
various ways of reassuring the public that the facility was safe and clean
throughout the sport event experience.
 Figure 7.4 Blueprint of the sport service delivery system of a basketball
game.

Facility planning and physical evidence directly affect all visible operations. The
design of the facility determines how easy it is for customers to move between
their seats, restrooms, and food and beverage stands. Physical evidence such as
signage not only tells customers where to go and what is going on in the facility
during their visit, but can also be used to advertise or communicate upcoming
events. Poster and video displays of past events can increase the customers’
perception of being in a place where the product is, in this case, basketball
entertainment.
Facility planning has an equally important influence on invisible operations.
How monitoring, maintenance and television operations take place is highly
dependent on provisions made in the design and construction of the facility.
Figure 7.3 showed that the planning and preparation of the service delivery
system took place in the marketing department (an invisible part of the
organisation). This involved process and people issues, such as how to approach
customers, how to supply them with information or food, how many employees
would be needed on game night and for which functions (ushers, food and
beverage sellers, ticket sellers) and how often and when to clean restrooms. With
larger crowds, parking issues and crowd flow to and from the facility become
important. The blueprint tracks the customer, from entering the facility to exiting
the facility, and maps all possible interactions with the sporting organisation and
its personnel. The blueprint identifies where the sport marketer can influence and
vary the different components of place. A blueprint is therefore a vital instrument
for the sport marketer in optimising the service experience. It is, however, only a
start. As described at the beginning of this chapter, the actual delivery of service
is the key to success.
In the final section of this chapter, traditional marketing channels are discussed
– again using the basketball example to relate these channels to the distribution of
sport products.

Marketing channels for sporting goods and services

It was noted earlier that most sport service providers deliver the sport product to
the customer directly. The organisations involved in the process of making the
product available for consumption or use are jointly called a ‘marketing channel’.
The marketing channel performs different functions in order to enable producer
and customer to exchange goods or services. Armstrong et al. (2018) identify the
following functions of marketing channels:

transportation and storage

communication of information via advertising
personal selling
sales promotion
feedback (marketing research)
financing, and
services such as installation and repair.

A trade-off between costs and benefits will decide whether channel intermediaries
are necessary to perform some of these channel functions. Figure 7.5 shows
different marketing channels for sport products.
 Figure 7.5 Marketing channels for sport products.

Channels A and B are the most important marketing channels for sport products.
The majority of sport service products will be delivered through those channels,
as discussed earlier in this chapter. Channel A shows the delivery of the sport
product through the sport facility. Because the facility is usually owned and
operated by a third party, the facility provider is the channel intermediary.
Channel B shows the distribution of televised sport and distribution through a
facility provider. Both the television station and the facility owner are channel
intermediaries at the same level in the channel. They depend on each other to get
the product to the consumer.
Channels C and D are more applicable to sporting goods. Manufacturers of
sporting goods will often use wholesale organisations, or even agents (persons
selling to wholesale organisations), to channel their product from the
manufacturing plant to the retailer, and ultimately to the final consumer.
Manufacturing organisations use other organisations in the marketing channel to
concentrate on what they do best – namely, manufacturing. Overall costs will
become too big for the manufacturing organisation if it has to fulfil all marketing
channel functions (for example, marketing and sales to the final consumers of the
product). The manufacturing organisation therefore hires other organisations to
perform those functions.
The longer a marketing channel, the less control an organisation has over
delivery of the product to the final consumer. Because actual service delivery is
critical to consumer satisfaction, sport service organisations should aim to keep
their marketing channels as short as possible, as shown in channels A and B of
Figure 7.5.
In this chapter’s headline story, the organising committees of the London
Olympic Games used all described marketing channels to distribute the variety of
sport products. Olympic sport events were distributed through newly built
facilities or existing/renovated government-owned facilities. Some events were
not shown on television (channel A). The majority of events, however, were
broadcast throughout the world on television (channel B). Huge amounts of
licensed Olympic merchandise were produced by many different manufacturers
around the world, using channel C or D as their means of distribution. After the
Games, ownership of the facilities and actual users were largely separated, and
the distribution of sport products now predominantly takes place through
channels A and B. Both before and during the distribution process, facility
planning, physical evidence, process and people are all place variables to consider
in the short and long term. Quality service delivery both during and after the
Games was, and will continue to be, of the utmost importance.

Summary
This chapter described and explained the unique characteristics of the sport
distribution system. Identifying sport products primarily as service products, it
was explained how layout accessibility, facility aesthetics, seating comfort,
electronic equipment and displays, service providers in the facility and facility
cleanliness all have a significant influence on how sport fans and participants
perceive the quality of the stadium or sport centre. In turn, the perceived quality
of the sportscape affects the sport consumer’s satisfaction with the sportscape.
And if sport consumers are more satisfied, they are likely to become loyal users
and/or stay at the stadium for a longer period, spend more money and return to
the stadium or the club more often.
Following the importance of the inanimate stadium or sport centre, the chapter
continued by discussing the four variables of place: facility planning, physical
evidence, process and people. Sport product delivery can be enhanced by
planning and designing the facility to suit customer and management needs.
Providing physical evidence to the intangible sport service product can enhance
distribution of the sport product and the actual service delivery process, and the
people involved in this process are crucial to the success of the sporting
organisation. Where and when to intervene, and how to influence the service
delivery process, were highlighted by introducing the blueprint, or an overview of
the sport service delivery system. The chapter finished with a discussion of
distribution systems, or marketing channels, used to distribute sport products.
CASE STUDY
The future of the sportplace: build it and they will come?
As observed as early as 2003 by Westerbeek and Smith (p. 114):

The issue of stadium capacity is a double-edged sword. On the one hand

stadia with limited capacity will lead to occupants not profiting from
maximising their gate receipts. On the other hand, too large stadia
contribute to increased operational costs, lack of atmosphere and
consequently, lack of support from the fans, impacting on other business
areas of the club like sponsorship, corporate hospitality and TV revenue.

Although the trend in international sport business is for the importance of gate
receipts as a component of the overall revenue picture to decline, a comparison
of the top three football clubs in Europe shows how important this income
stream still is. According to the Deloitte Football Money League (Jones, 2020),
both Barcelona and Real Madrid, numbers one and two on the list of richest
clubs in the world, still depend on matchday income for 19 per cent of their
overall revenue. For Manchester United (ranked 3) this is 17 per cent. The
compound annual growth rate (CAGR) for matchday income for the top 20
football clubs in Europe still stands at 4 per cent; however, this less than the
CAGR for commercial (8 per cent) and broadcast income (11 per cent).

The multi-purpose requirement

Most modern-day stadia cannot afford to be built for single-sport usage.
According to Rod Sheard, then senior principal at sport architects HOK, ‘stadia
need to be future proofed by building a critical mass of other facilities that will
ensure the project’s economic survival in another 20 years’ time’ (Menary,
2001, p. 46). As a result of the changing functionality of sporting arenas, fourth-
generation stadia incorporated facilities such as office space, hotels, restaurants,
retail arcades, exhibition pavilions, television studios, business centres, health
and fitness areas, and late-night activity options such as bars and nightclubs.
Wainwright (2017) noted that English Premier League (EPL) team Tottenham
Hotspur took this to the next level when they included a microbrewery and
Michelin-star restaurant within their new stadium precinct. NFL team the
Atlanta Falcons have built the world’s first 360° video wall.
In that regard it is also important to note that a new generation of sport
stadium is mushrooming all around the world. With the rise in popularity of
esports has come the opportunity to bring fans and players together in a physical
space, rather than meeting and viewing online on platforms such as Twitch or
YouTube. Esport stadiums are smaller than typical spectator sport arenas, but
will increasingly be viewed as part of the range of physical facilities in which
fans will come together to play and watch their favourite athletes and teams
compete. This is further exemplified by the fact that HOK have entered the
esports industry. HOK USA is based in Kansas City, and in 2018 the firm had
no designers working on esport. However in 2020 the firm had more than 15
dedicated esports staff, and this is only the beginning. The new Fusion Arena in
Philadelphia is an example of things to come. The 3500-purpose built esports
arena is home to the Philadelphia Fusion, competing in the Overwatch League.
Fitted with corporate suites, a training centre and a multimedia production
studio, the venue has been built inside the South Philadelphia Sports Complex,
home of the NHL’s Philadelphia Flyers and the NBA’s Philadelphia 76ers. This
will ensure that esport is fast-tracked into the sporting events mainstream
(Hughes, 2019).

The corporate push

Traditionally, the cost structure of building new stadia has been based on the
standard ‘cost per seat’. Over the past three decades, the corporate push has
seen an increase in costs for new stadia.
In the late 2010s – depending on the standard required, which largely relates
to the type of league the club is playing in and the type of customers it wants to
target – stadium construction costs could be as high as 14,800 Euros (A$24,000)
per seat (for example with the Tottenham Hotspur Stadium). However, nothing
exemplifies the corporate push more than the difference between the new
(opened 2009) and old (opened 1923) New York Yankees baseball stadium.
Nicknamed ‘The House that Ruth Built’, in reference to famed player Babe
Ruth, the 2009 stadium has exactly the same field dimensions as the 1923
venue. However, the reconstruction cost of US$1.7 billion equates to an
amazing US$33,806 (A$48,000) per seat. The ‘new’ home of the New York
Yankees has a capacity of 50,287 (6599 fewer than the previous stadium); but it
has more private luxury suites (19 compared with 56); ‘party’ suites (none
compared with 410); and concession stands (298 compared with 444); and has
seen the scoreboard double in size and upgraded to high-definition. On top of
this, most corporate sponsors have their own lounge areas, and there are
multiple branded restaurants and bars in the stadium. The fact is that average
income from corporate seats can amount to more than A$60,000 per season,
whereas the average income from a regular attendee will probably not exceed
A$5000 per seat per season. This explains why so many sport organisations
devote more space to developing their corporate facilities. With this increased
preoccupation with building for, and hence catering for, corporate hospitality
comes the impact on attendance patterns at matches. Not only is the corporate
dollar an increasingly important source of revenue for facility operators, but the
space in the stadium devoted to corporate facilities, the architectural building
style and multiple relationships with other stadium stakeholders also require a
reassessment of the facility’s positioning strategies. In other words, the facility
operators need to reassess their target markets.

Back to the future?

The sheer importance of investing in sport’s ‘hardware’ infrastructure becomes
clear when looking at some of the stadium investment figures from the English
Premier League. Tottenham’s new stadium cost a staggering £750 million and
seats 61,000 people (Wainwright, 2017). As reported by KPMG Football
Benchmark (2019),

Despite the large number of venues inaugurated in recent years, the

renovation, reconstruction or development of new stadium infrastructure
remains a challenge for many European clubs and countries. As the
development cost of major venues – designed to meet strict UEFA and
FIFA requirements to host world-class events – continues to increase,
another major challenge is the evaluation of the risk and return of capital
investment projects, such as stadium and training complexes, and the
potential integration of residential or commercial real estate into the
concept to improve the financial sustainability of a stadium development
project.

In the last ten years Premier League average attendance has been on the
increase, peaking in the 2017–18 season with 38,484 fans (Gough, 2019), while
capacity utilisation increased to 96.5 per cent for the 2016–17 season (Lange,
2019).
In the United States, stadium development projects have in a way turned
back the clock. At least on the field, there seems to be a push towards re-
establishing single-purpose stadia – particularly in soccer and baseball. Off-
field, multi-purpose space allocation (office space, restaurants, retail, etc.) does,
however, remain the norm. Baseball teams in particular have recognised the
value of the past, and have embarked on redeveloping existing ballparks or
building new ones that reflect the history and tradition of the game, ensuring
 that the architecture blends in with the early 1900s’ inner-city buildings yet
incorporating the latest technology that the modern-day fan requires to enjoy the
game to the fullest: better views; in-seat interactive video screens; multiple
replay screens in the stadium; comfortable seats; automated payment systems at
concession stands; and interactive (augmented reality) technology and games
for kids and adults alike before, during and after the match.

Questions
1. Comment on how the variables ‘facility planning’ and ‘physical evidence’
apply to the different sections of this case study.
2. Comment on how the variables ‘people’ and ‘process’ apply to the
different sections of this case study.
3. Can you think of other standards that may replace ‘cost per seat’ as a better
way to account for facility construction costs? Justify your answer.
4. Assume you are tasked with building a new stadium. What new features
would you include, and how would this open up new opportunities for
sport marketers?

References
Weblink: Aljazeera.com (2020, June 10). Coronavirus: What sporting events
are affected by the pandemic?
https://www.aljazeera.com/news/2020/03/coronavirus-sporting-events-
affected-outbreak-200310084205890.html.
Armstrong, G., Adam, S. Denize, S., Volkov, M., & Kotler, P. (2018).
Principles of Marketing (7th edn). Pearson, Melbourne.
Bitner, M.J. (1992). Servicescapes: The impact of physical surroundings on
customers and employees. Journal of Marketing, 56(2), 57–71.
de Carvalho, M., Boen, F., & Scheerder, J. (2015). Sportscape as a constraint
on soccer attendance: Is it predicted by place attachment and by team
identification? Journal of Facility Planning, Design, and Management, 3(2),
134–147.
Galante, P. (2020, April 24). Seven facilities management considerations for
re-entry post-COVID-19. CBRE. https://www.cbre.com.au/about/content-
feeds/expert-opinions/articles/seven-facilities-management-considerations-
covid-19.
Gough, C. (2019, August 28). Clubs of the English Premier League ranked
by average attendance in the 2018/19 season. Statista.
https://www.statista.com/statistics/268576/clubs-of-the-english-premier-
league-by-average-attendance/.
Grant Thornton (2012). Meta-evaluation of the impact and legacy of the
London 2012 Olympic Games and Paralympic Games. Department for
Culture, Media and Sport, London.
Grönroos, C. (1990). Service management and marketing. Lexington Books,
Boston, MA.
Hill, B., & Green, C. (2012). Repeat participation as a function of program
attractiveness, socializing opportunities, loyalty and the sportscape across
three sport facility contexts. Sport Management Review, 15(4), 485–499.
Hogg, G., & Gabbott, M. (ed.) (2013). Services industries marketing: New
approaches (2nd edn). Routledge,New York.
Hughes, C.J. (2019, May 28). As e-sports grow, so do their homes. New York
Times. https://www.nytimes.com/2019/05/28/business/esports-arenas-
developers.html.
Ioannou, P., & Bakirtzoglou, P. (2016). The relationship between stadium
factors on spectators’ satisfaction in Greek Soccer Super League. Journal of
Human Sport and Exercise, 11(4), 437–443.
Jang, W., Byon, K., & Yim, B. (2020). Sportscape, emotion, and behavioural
intentions: A case of the big four US-based major sport leagues. European
Sport Management Quarterly, 20(30, 321–343.
doi:10.1080/16184742.2019.1607521.
Jones, D. (ed.) (2020). Deloitte money football league: Eye on the prize.
Sport Business Group, Manchester, UK.
https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/sports-
business-group/deloitte-uk-deloitte-football-money-league-2020.pdf.
KPMG Football Benchmark (2019, November 26). Stadium developments:
The boom continues.
https://www.footballbenchmark.com/library/stadium_developments_the_boo
m_continues.
Lambrecht, K.W., Kaefer, F., & Ramenofsky, S.D. (2009). Sportscape factors
influencing attendance and satisfaction at a professional golf association
tournament. Sport Marketing Quarterly, 18(3), 165–172.
Lange, D. (2019, September 6). Average stadium utilization of professional
football matches of the Premier League in England from 2010 to 2017.
Statista. https://www.statista.com/statistics/799770/the-premier-league-
stadium-utilization-england.
Langeard, E., Bateson, J., Lovelock, C., & Eiglier, P. (1981). Marketing of
services: New insights from consumers and managers. Report no 81–104.
Marketing Sciences Institute, Cambridge, MA.
Lee, S.Y. (2017). Service quality of sport centers and customer loyalty. Asia
Pacific Journal of Marketing and Logistics. 29(4), 870–879.
doi:10.1108/APJML-10–2016–0191.
Legg, D., & Baker, J. (1987). Advertising strategies for service firms. In C.
Surprenant (ed.), Add value to your service. American Marketing
Association, Chicago, 163–168.
Melbourne and Olympic Parks (2007). Melbourne rectangular stadium.
www.mopt.com.au/deskstopdefault.aspx/tabid-22//243_read247.
Menary, S. (2001, December). Clubs profit from good groundwork, Football
Business International, 44–46.
Mittal, B. (2002). Services communications: From mindless tangibilisation
to meaningful messages. Journal of Services Marketing, 16(5), 424–431.
Nguyen, H. (2020, May 26). Vietnam scores impressive goal as competitive
football returns, VnExpress.
https://e.vnexpress.net/news/sports/football/vietnam-scores-impressive-goal-
as-competitive-football-returns-4104848.html.
Oman, B., Pepur, M., & Arnerić, J. (2016). The impact of service quality and
sport-team identification on the repurchase intention. Management, 21(1),
19–46.
Pacheco, A. (2019, June 20). Before the 2028 Olympics, L.A. embarks on its
most transformative urban vision in a generation. The Architect’s
Newspaper. https://www.archpaper.com/2019/06/2028-olympics-los-
angeles/.
Wainwright, O. (2017, June 15). Stadiums of the future: A revolution for the
fan experience in sport. The Guardian.
https://www.theguardian.com/sport/2017/jun/15/stadiums-future-holograms-
drones-fan-experience.
Wakefield, K.L., & Blodgett, J.G. (1994). The importance of servicescapes
in leisure service settings. Journal of Services Marketing, 8(3), 66–76.
Wakefield, K.L., & Blodgett, J.G. (1996). The effect of the servicescape on
customers’ behavioral intentions in leisure service settings. Journal of
Services Marketing, 10(6), 45–61.
Wakefield, K.L., & Sloan, H.J. (1995). The effects of team loyalty and
selected stadium factors on spectator attendance. Journal of Sport
Management, 9(2), 153–172.
Wakefield, K.L., Blodgett, J.G., & Sloan, H.J. (1996). Measurement and
management of the sportscape. Journal of Sport Management, 10(1), 15–31.
Westerbeek, H., & Shilbury, D. (2003). A conceptual model for sport
services marketing research: Integrating quality, value and satisfaction.
International Journal of Sports Marketing and Sponsorship, 5(1), 11–31.
Westerbeek, H., & Smith, A. (2003). Sport business in the global
marketplace. Palgrave Macmillan, London.
CHAPTER 8

Sport and media distribution

DOI: 10.4324/9781003270522-11

Chapter objectives
Chapter 8 examines the sport–media nexus and the distribution of sport
content to audiences. Specifically, it describes how content providers and
distributors can generate revenue through advertising and audience
subscriptions, and how this revenue determines the level of media rights
acquired by sport organisations. We outline in this chapter both the nature of
demand for sport media content and the central mix of platforms by which
consumers access sport content. This considers traditional models as well as
emerging platforms for content delivery, and the business models of each. From
a consumer view, consumption patterns, interactivity and engagement are
focuses of sport media distribution. Finally, this chapter describes how sport
programming is measured, and the link between this system of measurement
and how commercial partners assess the value of their investment.
After studying this chapter, you should be able to:

understand the commercial basis on which television and media channels

operate
identify why sport programming is attractive to media networks and
advertisers
understand the changing breadth of platforms used to disseminate sport
content and the business models each uses
recognise the impact of digital technologies on media distribution,
including implications for consumer engagement and interactivity
understand the issues inherent in measuring television and digital channel
audiences and their links to determining advertising effectiveness.

Headline story
The fragmented sport media experience
In 2013 Football Federation Australia (FFA) commenced a seven-year broadcast
deal with Fox Sports and SBS. For soccer fans in Australia, the deal ensured
that all soccer content – including coverage of many popular overseas leagues
(such as the English, Spanish and Italian leagues as well as the UEFA
Champions League) – was available across pay-TV network offerings and SBS
(a free-to-air broadcast channel). All these leagues were already shown on Fox
Sports and, therefore, one subscription to the sole pay-TV provider in the region
allowed access to all soccer viewing needs.
Fast forward to the end of this deal, and the fragmentation seen globally in
broadcast rights could not be clearer. For coverage of soccer in Australia in
2021, fans can choose from:
 Network 10 (free-to-air) and Paramount+ (streaming service) for A-League
(men’s and women’s) and all Socceroos and Matildas (men’s and women’s)
matches outside of World Cups
Optus Sport (streaming service) for the English Premier League (EPL) and
the FA Women’s Super League, as well as the 2023 Women’s World Cup
Foxtel (pay-TV) and Kayo Sports (streaming service) for England’s
Carabao Cup (League Cup) and English Football League (EFL)
Championship, Italy’s Serie A, France’s Ligue 1, Germany’s Bundesliga,
the Scottish Premiership and North American Major League Soccer (MLS)
Nine Network (free-to-air) and Stan (streaming service) for Europe’s
UEFA Champions League
Sports Flick (streaming service) for the K-League, Chinese Super League,
Austrian Bundesliga and the Women’s UEFA Champions League.

For fans wanting access to all platforms, it can cost over $80 a month to watch
the game’s most popular leagues and tournaments across multiple platforms
(Samios & Rugari, 2021). As well as the cost, this potentially presents a
complex offering for a consumer to manage. Payments, logins and apps are
needed for all; and this is not to mention local and regional competitions in
Australia, such as the National Premier League, which can be streamed on
additional platforms.

The new sport–media nexus

Sport generates a major component of its principal source of revenue via media
distribution. For many sports – including the National Basketball Association
(NBA) and National Football League (NFL) in the United States, cricket and the
Australian Football League (AFL), soccer in European markets, and golf and
tennis worldwide – television rights provide a substantial source of revenue. The
initial purpose of this chapter is to explore the sport–television relationship,
including the technological, social and consumer trends that have driven the
consumption of sport and created opportunities for rights holders and other
stakeholders. Clearly, exchanges in the sport media setting are business
relationships and, in many cases, are ones that have grown in importance and
complexity globally. Television and media networks now demand more from their
rights to broadcast than in their previous partnerships; however they remain
acutely aware of the value of sport to audiences.

Drivers of change in sport and media distribution

The three macro-drivers of television ratings were historically news, sport and
movies. The first is gradually being lost to the internet. The latter has lost its
momentum because of a coterie of ad-free platforms, including streaming (and,
prior to this, pay-TV, pay-per-view, DVD, etc.). What is left in television’s sights
is exclusive rights to sport. The reason for their popularity is simple: live sport
and live reality shows remain largely immune from ‘time-shifted’ viewing and
illegal downloading, and they continue to attract big audiences. In short, the value
of sport is within the ‘ephemeral’, or short-term, live nature of the offering it
provides to audiences. Arguably, sport has held this value as well as or better than
other genres.
But even premium sporting rights are proving to be increasingly challenging
and complex. Deals for rights packages such as the Olympics require non-
traditional distribution methods or partners to create the breadth of delivery
needed to justify the cost and meet expectations of multi-channel, multi-platform
coverage. Consumers watching the Olympics on media channels demand more
than a single channel showing the ‘director’s choice’ of broadcast content.
Previously, this was done by selling rights (e.g., to pay-TV companies or other
networks) or via the creation of multiple free-to-air or linear channels (multi-
channelling). More recently, the adoption of streaming platforms or apps is
allowing consumers to access more content of their choice. For example, at the
Tokyo 2020 Olympics, delivery to markets had expanded to provide the ability to
choose which of dozens or more concurrent events a viewer would wish to watch
via their mobile device or streamed to a TV or projection device.
To this end, there has been an emergence of a new entrepreneurial model in
sports broadcasting (Tsiotsou, 2012). This is creating much complexity and
fragmentation of the broadcast offering and market for rights. For example, while
previously rights holders and advertisers worked with a relatively simple range of
rights buyers (TV networks), there are now multiple options and buyers seeking
access to rights and exclusivity. For consumers, as our Headline Story showed,
this results in a heavily fragmented setting of new players and platforms.
However, the fragmentation of soccer for Australian audiences is not unique. For
example, established buyers such as television networks commonly own
streaming platforms and offer new ways to view content via a mix of free-to-air
and streaming access. New players include social media and e-commerce
platforms (e.g., Twitter, Facebook, Amazon) that are playing an increasing role in
the market for sport rights. Complicating that balance of power further is the fact
that many sports teams and bodies have, or are developing, their own media
businesses (e.g., MLBTV in the US for baseball and AFL Media in Australia),
stretching the ‘exclusivity’ of broadcast rights to generate content from which
they can profit. This is not unique to large organisations, with lower production
costs and more accessible technology providing scope for smaller sport
organisations to ‘self-produce’ and on sell rights to their content, which may
include, for example, regional or national championships.

Stakeholders in sport media distribution

In line with the changes noted in the introduction to this chapter, the stakeholder
mix is representative of this new level of complexity. Figure 8.1 displays the
principal players in the sport television business: rights owners, rights buyers,
advertisers and consumers. We note here that while the focus of this chapter is on
television or audio-visual content distribution, the same stakeholders, and many
of the issues in this chapter, are relevant for radio rights as well.

Figure 8.1 The sport–media relationship model

Fundamentally, some components remain the same from the pre-2000s’ structure
of the commercial television industry, where the key value to media rights was
the sale of airtime to advertisers in order to reach consumers. In many cases, the
advertising agency shown in Figure 8.1 acts as a broker, or ‘middleman’, between
corporate clients purchasing advertising time or broadcast sponsorships and the
networks. The price at which airtime or access is sold is a function of a number of
factors, the most important of which are the number of television viewers and the
price and availability of advertising space on suitable alternative media.
Commercial television as the traditional component of the mix uses programming
to influence the size and profile of its viewing audience, which is measured by
independent ratings. What now also exists are new players or buyers in the
market (i.e., streaming platforms that enter the market for sport rights) and new
forms of relationships or flows between broadcast stakeholders (e.g., sport
leagues and teams that package and stream their own media content direct to
audiences).
The principal profit equation for these relationships is to ensure that the
revenue-generating capacity of programming sufficiently exceeds both its cost of
production or acquisition and associated overheads to produce a reasonable return
on investment for the media partner. The models for revenue are discussed later in
this chapter (as they can be different for different formats or platforms) but can
be, for example, subscription- or advertiser-based revenue models. In some
settings, a combination of these models can be offered.
In any setting, to achieve a reasonable return on investment, networks rely on
programming that has the ability to capture and captivate an audience. The series
of relationships shown in Figure 8.1 is driven by the middle circle – the system of
measuring the number of people watching specific programmes. The audience
therefore is the currency used to measure the success of television and media
programming. This figure determines the success or failure of programming and
investment in sport rights and, as a consequence, profitability.
In determining business outcomes like profitability, and aligned with the
‘interest intensity’ that can be applied to situations, stakeholders in the sport
media setting will seek to act in ways to protect their own interests (Turner,
2012). This creates a range of critical issues which are a continuing part of
industry practices and tensions. For example, to ensure that networks and rights
buyers maximise their revenue and profits, programme directors and media
executives are increasingly influencing the scheduling of games and events. The
balance between playing at times conducive to optimum athletic performance and
playing at times best suited to optimise ratings is one aspect of the sport–media
relationship that creates tension and has the potential to upset the mutually
beneficial relationship currently in existence.

Demand for sport content: the value of sport programming

The importance and significance of the sport–media relationship is indicated by
the rapid increase in sport programming that has occurred since the inception of
television over half a century ago. For the Australian market, in Sydney in 1958,
just over 12 hours of sport programming went to air during the week commencing
1 September. By 1988 five channels had shown 43 hours of sport during a similar
week (Jarratt, 1988); and by 2007 just under 90 hours of sport programming were
shown on free-to-air channels, with at least three local pay-TV channels
providing 24-hour sport programming. In the current setting, both the volume and
range of sport offered to consumers have continued to grow significantly.
The increased supply of sport impacts measures and inputs when determining
sports rights value. Leveraging early sport economics works, demand for sport is
created by spectators (direct and indirect) as well as media providers who are
reliant on advertising revenue (Neale, 1964). Specific to media, Noll (2007) notes
that demand for sports television rights is derived from the ‘final demand’ for
content. There are a number of other key principles relevant to the understanding
of sport products as public goods. For example, sport content in the media setting
is generally subject to substantial economics of scale and scope. In simple terms,
once the production costs are applied to create the sport content, there are
generally limited costs to show the product to more people. Further, the value of
broadcast is a product of league and event competition, but can be subject to
regulatory reform and impact of regulations (see the case study at end of the
chapter on anti-siphoning legislation as an example).
There are also implications for league and team operations linked to strategies
and competing revenue streams. For example, even though more people watch
via media channels than attend live for most events, there is a perceived media
impact on gate or ticket revenues. In this sense, consumers may make active
choices to watch a game on television in the local market instead of attending
live, which, at scale, may impact ticketing revenue. Research has shown that
‘media-dominant consumers’, counter to past thought, can be highly committed
fans who simply choose different ways to construct and balance their sport
experiences across live and mediated settings (Karg et al., 2019).
In addition to market forces that have dominated discussion of supply and
demand, other questions arise on what sport managers can do to enhance the
attractiveness of a sport from a media perspective. There are no easy answers to
these questions. Some sports have used rule changes to make the game more
attractive; others have changed the uniforms (kit) worn by players to make them
more appealing; other sports have simply paid for airtime until their sport has
become well recognised and people want to watch it on a regular basis. The
creation of breaks in play to create new advertising opportunities and embracing
changes to fixtures and scheduling to prioritise certain audiences and
technological innovation all provide a nod to the power of networks and media
partners’ drive for ratings, and provide working examples of the tensions that can
exist between stakeholders. In assessing the needs and priorities of fans,
broadcasters and organisations, there are pertinent questions to balance around
the commodification and traditions of sport.
 Technical provisions within a media broadcast can also be crucial. What are
the aspects of production and viewer experience that sports or organisations
should engage with and prioritise? Sport being played in empty stadiums in 2020
as a result of the onset of COVID-19 taught organisations a lot of about the ‘hard
to replicate’ and, ultimately, very valuable setting of the sport stadium. Clearly,
fans noted that sport was less enjoyable compared to pre-COVID times
(KANTAR, 2021). Part of the organisational response was to recreate the noise
and atmosphere in the stadium, partly to allow audiences to leverage social cues
and help link inferences to on-field activity, or to enhance perceptions of
excitement (Cummins et al., 2019). While we might think of audience noise as a
simple addition, there is depth to the need to robustly consider its role not as a
basic feature but in creating experience and engagement of viewers. Other
prominent features can include microphones around venues to gather athlete or
umpire interactions, super slow-motion replays and on-screen graphics.
Announcers play a critical role in creating storylines, building characters and,
therefore, the overall experience. In building and leveraging engagement of
established consumers, or a platform for engaging new consumers, the production
of a broadcast, and associated costs, warrants careful consideration for sport
organisations in terms of the value it can add.
The above factors help underpin the value that can result from sport media
experiences, spanning an economic or production focus. However, the features of
sport programming described by Klattell and Marcus add to our understanding of
why sport is so attractive to television. They summarise the intrinsic value of
sport programming to television:

At its best, television sports is the finest programming television can offer. In
many respects, sports may be the quintessential television program format,
taking fullest advantage of the role TV plays in our daily lives. Sports on TV
have visually attractive elements – splashy colors, attractive locations,
motion and movement galore. They have expansive vistas, exquisite details,
and larger-than-life images … There is drama, tension, suspense, raw
emotion, real anger, unvarnished joy, and a host of other responses. Most of
all you are watching real people compete for real, as unsure of the outcome
as the viewer. In sports TV the ‘bad guy’ of the script often wins, unexpected
things happen, virtue doesn’t necessarily triumph, and goodness is not
always rewarded. (Klattell & Marcus, 1988, p. 4)
Distribution platforms for sport programming: from free-to-air to
digital streaming
More than 30 years after Klattell and Marcus articulated why sport and television
were such a good match, sport programming remains in demand and is a ratings
winner. However, there is now a mix of platforms by which consumers access
sport content. Figure 8.1 provides a framework to explore the changing role and
power of stakeholders, and new ways in which entrants are engaging in rights
markets. In line with this, consumption patterns – such as how viewers access and
watch a broadcast, as well as how they engage with sport and media channels
beyond a match-day broadcast – are also important. There are also implications
for valuation and measurement (i.e., how popularity is measured) as well as
regulation and sport media contracts. Ultimately, at the heart of this change and
innovation is technological change, which has driven a shift from linear, satellite
and free-to-air television towards a plethora of digital channels. Much of the
technology associated with this change has been dependent on the increasing
bandwidth or the capacity to distribute content. In short, digitised information can
be made to take up much less space than analogue signals, and therefore
transferred and received much more effectively (Todreas, 1999). As well as
increased digitalisation and technology, the business models for underpinning
different sport and media provisions have shifted, as discussed below.

Linear free-to-air television

Free-to-air networks and commercial television provided the initial forms of
access media rights, and, today, still provide enormous value for sport
organisations. While the initial ‘linear’ delivery of these platforms provided
limited or no interactivity, and lacked the ability to feature time-shifted or catch-
up options (i.e., to store and replay a show that was broadcast previously), they
still provide access and scope to reach the widest possible audience (hence the
term ‘broadcast’). Given that commercial television stations are often free to view
and highly accessible, they create physical access and availability of sport content
to help reach existing and new audiences (McDonald & Lock, 2017). In
generating revenue, free-to-air television relies on a basic advertising model as a
primary source of revenue and profit. To leverage their advantage in providing
access to large audiences, advertisers pay to be integrated into the broadcast, or
‘sponsor’ the broadcast.

Pay-TV and pay-per-view

With the advent of cable or pay-television came new options for sport rights
holders and buyers. Pay-TV was introduced to Australia in 1995 (following many
other markets) and contributed greatly to the globalised economy, and in
particular the familiarity of overseas sports. Market penetration rates in Australia
were significantly lower compared with the US (> 80 per cent) and Europe (> 50
per cent). One reason was the legislation governing the introduction of pay-TV in
Australia, which prohibited major sporting events from being shown solely on
pay-TV. For example, the AFL Grand Final, the Melbourne Cup (horse racing),
major golf and tennis events and the Olympic Games were subject to ‘anti-
siphoning’ laws designed to ensure that the majority of the population retains the
ability to see these sporting events (see the case study at the end of the chapter for
more details). The business basis on which pay-TV is predicated is fundamentally
different from that of the free-to-air networks described above. The operating
premise on which pay-TV exists is known as ‘narrowcasting’, and its revenue
base is sourced from subscription fees. That is, it requires the payment of a
subscription to receive programming. Unlike the free-to-air networks, advertising
is not the predominant revenue source on pay-TV, but was a secondary method
for networks to generate revenue. The technology of connected pay-TV also
introduced pay-per-view programming, where access to special events was sold at
an individual level, providing an initial example of ‘on-demand’ distribution.

Digital channels
Such individual-level consumption via pay-per-view provided a window to the
future. The late 2010s saw the widespread adoption of streaming platforms or
‘over-the-top’ (OTT) digital delivery of media and entertainment content
globally. This led to many viewers switching their media and entertainment
consumption to a range of streaming and digital television services for sport as
well as for other entertainment genres. In some markets, this led to the process of
‘cutting the cord’ for many consumers (or the movement away from cable or pay-
TV forms, to be replaced by digital streaming). This change has had major
implications for sport. The first is in delivery, where information and content is
passed or distributed digitally via internet services or protocols to provide secure
and reliable delivery of entertainment video and related services to subscribers.
This provided new ways and new models for not only sport matches and games
but also a range of associated sport content to be created, distributed and
consumed with greater ease and efficiency. Second, major structural changes have
occurred in broadcast markets. This has seen existing providers of free-to-air or
pay-TV operations create streaming platforms, or new streaming platforms enter
the market for sport rights. For example, Amazon and Twitter (NFL) and
Facebook (FA Cup) are among platforms that have broadcast live sport events.
Direct distribution by sport organisations, where leagues and teams package and
stream their own media content direct to audiences, is also evident. Media
channels can focus heavily or exclusively on one sport (e.g., the Golf Channel or
Ultimate Fighting Championship (UFC) Platforms), one league (e.g., NFL
Network or NBA League Pass) or a single team (e.g., Yankees Entertainment and
Sports in the USA or Real Madrid TV in Spain). Likewise, media companies and
platforms such as DAZN, ESPN and Kayo (Australia) have arrived in global or
domestic markets.
The major impact of the digitalisation of sport media content is platform
fragmentation, where the landscape is changing substantially due to the growing
number of ‘niche’ channels. It should be noted that digitalisation has also driven
the proliferation of sport media where the match, game or event is only one focus
of value. With the advent of many channels and platforms, the focus on additional
magazine-type shows, segments, highlights, interviews and short-form content
about or related to the sport has swelled. This has provided not only additional
content from promotion of the sport, but also more opportunities to brand or
commercialise the content generated for such platforms. Previously, free-to-air
and pay-TV platforms did not provide scope for additional content to be used or
broadcast alongside or in addition to match broadcast. However, the ‘on-demand’
or ‘24/7’ nature of digitalised streaming services and the presence of social media
as communication platforms provide more scope to generate a wider range of
content for different audiences.

Business models and new opportunities in sport media distribution

As the complexity of platforms has increased, the breadth of the sport–business–
media relationship has intensified in terms of competition for revenue sources and
viewers. Sport organisations, once faced with limited distribution options, are
now presented with myriad innovative media platform systems. Further,
consumers are now able to watch sport programmes through many different
conduits, including terrestrial, satellite and cable channels as well as streamed
services on mobile devices. Across this diversification, the business models for
sport programming remain fundamentally about designing programming on
appropriate platforms in order to capture a market of viewers. From there, the
models seek to either expose them to advertising or acquire them as subscribers to
services.
In sum, revenue and cost structures and models across platforms are
substantially different. Free-to-air or commercial TV stations in most cases are
considered advertising channels (Solberg 2002). Viewers ‘pay’ by watching
advertising, and sport organisations and media seek to maximise the number of
customers or viewers. As long as revenue outpaces costs, advertisers will be
willing to pay for advertising (Kaldor, 1950). However, willingness to pay will be
‘broadly proportional’ to the size of the audience (Solberg, 2002). Providing
some added variables to consider, there are often limitations on the amount of
advertising content that can be sold and placed within television or media
programming. Increasingly these regulations are also applied to product
categories. These seek to limit the provision and visibility of, for example,
gambling companies to advertising during certain hours of the day.
Pay-TV and cable models allowed the development of subscription-based
offerings, where consumers could access a bundle of channels or packages of
sport content. The concept of subscription is commonly applied to streaming or
OTT platforms as well, where subscriptions can be accessed by users. These are
often lower in cost than existing pay-TV products, and provide high levels of
flexibility and customisability. As a product of cost structures and offerings, it is
not uncommon for fans to hold or purchase access to multiple packages or OTT
platforms concurrently to access the content they need.
Such platforms do however offer more than just access to a fixed product. The
use of various devices such as tablets and smartphones is expanding the means by
which viewers can interact with sport content, as well as organisations and teams.
Significantly, these trends broaden interactivity and engagement beyond the
game, and have quickly emerged beyond the embryonic examples of interactivity.
Early translations included, for example, a ‘red button’ that allowed some form of
customisation of the broadcast (i.e., the button would allow viewers to select from
alternative versions of commentary in different languages or tailored to a
particular fan base). In recent settings, we see improved quality via digital
transmission, as well as sophisticated new platforms that allow more interactivity
and greater control by sports consumers that extend to when the programme is
watched (on demand or live), the cameras and angles viewed, and what replays
are seen and when. Viewers can choose a preferred match and court at
Wimbledon, or focus on a single hole or playing group they would actually like to
watch during a golf tournament. Further, the sport fan has access to a choice of
commentary, statistics overlays or graphics presentations, all of which will
continue to increase as data rights and their use in consumer engagement becomes
more prominent during the next decade. As well as enhancing individual
experiences, new interactivity can be used by athletes or by communities of fans
as part of enhanced engagement. For example, media platforms like Twitch that
first found popularity in the gaming and esports community have normalised new
forms of interactivity as a peripheral activity to a main event, and provide new
ways to build and extend community and connection around sport.

SPORTVIEW 8.1
Interactive sport and the ‘second-screen’ experience
It is emerging as common practice for sport fans to engage with additional
mobile devices as they watch sport on television. Research states as many as 70
per cent of people watching TV simultaneously use a second screen to keep
themselves occupied or entertained (Hallbäck, 2020). Whether used for
communicating with friends, engaging with statistics and data, playing fantasy
sport or browsing merchandise, this practice represents an emerging form of
behaviour for many sport fans.
This is known as the ‘second-screen’ phenomenon, where another device
becomes an interactive part of regular television viewership (Blake, 2016).
Permeating life, apps are available for many needs, with smartphone and mobile
use an established part of daily life for many. For evidence that sport is a
primary candidate for second screening, look no further than the traffic on social
media channels when sport is broadcast. This provides a clear indication of the
opportunity and scope for wider engagement than the primary screen, with
opportunities for interactive sport experiences greater than ever.
Pfeffel et al. (2016) note that the activities of second-screen using sport fans
could be classified as functional (e.g., involving statistics, commenting and
discussion) or social (talks or discussions, including expert Q&As), or related to
gaming and competition (quizzes, voting, raffles). Each of these areas is aligned
with the idea of consumer engagement (Brodie et al., 2011, 2013), with
affective, cognitive and behavioural dimensions prominent in the consideration
of such activities. Put simply, these features, used alongside sport, can be
designed to provide enjoyment or hedonic value, a way to learn and process
relevant information, and a way to impact or extend consumer behaviours
linked to a sport event.
Apps from sport organisations, leagues or teams are prominent settings
where sport organisations design second-screen experiences to complement
broadcasting. Formula 1 presents an advanced example. Here, the apps and
platforms allow viewers to customise their experience with alternative audio
and visual streams (for example, the choice of multiple driver cameras or
alternative commentary), access differing levels of statistics and technical data,
and engage with other fans via voting, competitions and discussions.
 As well as more customised experiences that allow the viewer to ‘co-create’
and extend their media experience, the second screen is evolving towards more
immersive experiences. For example, integration with other connected devices
and embedding media experiences with augmented and virtual reality provide
examples of a transition towards deeper forms of engagement and interaction
beyond the primary screen.

Additional source: Young (2017).

Digital distribution, and the enhanced scope for engagement and interactivity
(evidenced in Sportview 8.1), provides significant implications for sport media
groups and consumers. Further, the opportunities arising from technological
developments such as digital television need to be considered carefully by sport
marketing managers. These implications extend beyond the value of television
rights, and include: an understanding of where control and rights within contracts
start and stop (for example, audio-visual content rights vs. data rights); how to
structure and commercialise new assets such as apps and interactive experiences
with sponsors and partners; and how to most effectively provide a setting or
platform through which consumers can actively create, and engage with, the sport
experience they desire.
In discussions of audience enjoyment, and as noted above, interest in sport as a
media product now extends well beyond the matchday. As well as the 90 minutes
of a football match or the three or five sets of a tennis Grand Slam, media
platforms, advertisers and consumers have greater collective interest in more
forms of content. While highlights shows, detailed analysis, injury reports and
lifestyle shows leveraging sport assets are more common, this can even extend to
reality shows. For example, The Ultimate Fighter, a US reality show channelling
the fortunes of a group of mixed martial artists, has exceeded two dozen seasons
and provided a platform to successfully grow UFC audiences. Cricket and
Australian Rules football have done the same. As well as audio-visual content or
shows, the emergence of data rights has seen sport statistics and athlete data
become viable rights assets on their own. Clearly, there is an emerging demand
for enhanced data and statistics, be it the heart rate of an archer, the speed of a
wide receiver, the distance covered by a soccer player or the speed or velocity
generated by a baseball pitcher. This in itself leads to some questions. For
example, who owns this data, and how is it best used?
 In addition, traditional broadcast aspects can provide new opportunities when
transitioning to a digital media setting. The perimeter advertising common at
sport events is one example. While sponsor or advertiser branding around a
soccer or hockey pitch is not new, virtual advertising – made possible by digital
technology – highlights the concurrent opportunities and complexities new
technologies create for sport managers and media executives. For example,
virtual advertising can be incorporated into a telecast without disrupting the
spectators’ view, and can be customised to communicate a different message or
brand in different markets, or to different customers. For example, those watching
a game in Europe may see different brands than fans watching in Asia. Equally,
viewers known to be older may see different advertising from that shown to a
household or on a device known to be watched by younger viewers. Hyper-
customisation in sport media is yet to fully evolve, but a lens to a data and digital
future projects a setting for more customised advertising, and unique and targeted
messages to be sent from organisations to consumers. Ultimately this should add
further value to commercial partners looking to leverage associations with sport.
In sum, specific to digital considerations, we see a proliferation of content
options and providers, all of which are relatively easier for consumers to access
via apps and smart devices. With less reliance on terrestrial or linear television as
the only platform for sport consumption, the ability of fans in diverse
geographical markets to access platforms and content is more fluid than ever.
While providing wider coverage of major sports may secure higher rights fees,
comparatively lower production costs for content creation and distribution also
create opportunities for non-commercial sports to secure a platform to
communicate their content with fan bases, even if those fan bases are small.

SPORTVIEW 8.2
Super Bowl: still the jewel in the advertising crown
The pinnacle of the NFL, the Super Bowl, continues to be the flagship event for
advertising in annual sport events. In 2021, the CBS network generated a record
US$545 million in advertising spending (Dang, 2021). This utilised 57 minutes
of commercial time, with a 30-second ad costing an estimated US$5.5
million/A$7.11 million (Pash, 2021). While experts may differ in their views
about the value of advertising during the Super Bowl, the fact the annual
amount paid to be part of the advertising mix has doubled since 2010 (Gough,
2021) suggests that the event remains a premium opportunity, punctuated with
mass audience numbers of around 100 million.
 The Super Bowl used to be a fairly simple event for marketers. A brand
would purchase a spot, develop a high-impact commercial, run it and hope that
all worked well. Apple’s ‘1984’ spot is a perfect example of this approach:
Apple secured a space, developed a remarkable piece of advertising and ran it.
But the concept of Super Bowl advertising has changed fundamentally; it is
now far more complex and challenging. Overcoming distraction presents one
issue, with smartphones and other devices fighting for attention during
commercial breaks in telecasts. The fragmentation of audiences and social
media platforms are also providing new opportunities to communicate broadly
and engage with other people and with brands, providing further competition for
audience attention.
Responding to such factors, the recipe for Super Bowl advertising has gone
from being a central part of a single television event to being part of a wider or
extended campaign. Effectively, branding alongside the Super Bowl is now
about managing an entire multimedia campaign, not just one TV spot.
Brands now focus campaigns on the weeks leading up the Super Bowl. There
is also increasing interest after the event, with additional engagement with
content on social media channels following the airing of the game. In addition,
digital and social media campaigns are becoming part of an integrated approach
to Super Bowl advertising. Brands will often seek to extend the advertising
impact by stimulating or generating discussions and conversations and running
competitions and contests, often utilising large social media accounts and
followings.
The Super Bowl has a strong record of propelling effective impacts for
brands in cases where creative aspects are well developed and have been well
received. Counter to this, poorly received advertisements can damage brands.
The Super Bowl as an annual window for brands is more popular than ever for
advertisers and their agencies; but the execution, as part of wider and more
integrated campaigns, is also more complex than ever.

Additional source: Rucker & Calkins (2013).

Measurement of sport programming

A central component of the sport–media relationship model presented in Figure
8.1 was the concept of measurement. Sport viewership numbers are commonly
touted as a sign of success. Sport teams and leagues that can demonstrate large
and growing numbers of viewers can signal prestige or power in a market.
Sportview 8.2 provides an example of where advertising is sought after and
clearly tied to the size and profile of an audience. Therefore, the accuracy of, and
agreement on, forms of measurement is critical for the collective stakeholders of
sport and media distribution. Further, the direct link between audience,
advertising measurement and sport rights value should not be understated.
Alongside high levels of continued investment in sport rights comes a need to
understand the components, and limitations, of past and emerging forms of
measurement. Further, we have noted in the chapter already the focus on
advertising models as well as subscription platforms more common to pay-TV
and streaming services. It is important to understand the fundamentals of each
form of measurement. For advertising models, there are some initial
considerations for framing such measurement. When considering advertising in a
mediated setting, the extent to which an audience engages is a critical factor. For
example, the extent to which the media environment affects, tempers or
moderates the nature of the advertising response is one consideration. In sport,
two hypotheses have emerged relevant to this question. The first asserts that the
more involved viewers are in a programme, and the more they like it and are
engaged by it, the weaker will be the advertising response. Proponents of this
hypothesis maintain that commercial breaks represent an unnecessarily intrusive
element in an otherwise enjoyable viewing experience. As a consequence,
advertising may be filtered out, perceived negatively or simply avoided. The
second hypothesis adopts the opposite view: it suggests that characteristics of the
programme, as subjectively perceived by the involved viewer, produce efforts to
minimise surrounding distractions and cause an enhanced orientation towards the
programme and source of the stimulus. That is, involvement in the programme
primes their attentiveness and likely response to advertising.
Further, the setting provided by different sports offers different opportunities
for advertisers. In cricket, advertising breaks in play are short but appear at
predictable times – normally at the end of an over (every six deliveries). In
Australian Rules football, commercials shown after a goal is scored typically last
until around 30 seconds before play recommences. Other sports such as golf,
basketball and car racing may provide viewers with the opportunity to leave the
room, knowing that a series of four to five commercials will be shown. Here,
first-in and last-out commercials are considered more valuable as viewers see the
first before leaving the room and the last when returning after the commercial
break. Interestingly, networks will often use the first or last advertisement to
promote their own station programmes.
 All of these factors impinge on the effectiveness of advertising during sport
programming. Limited research has been conducted on sport programming, in
particular in a digital or streaming setting, to shed more light on the answers to
the questions raised here. There is little doubt, however, that these issues form the
basis on which networks set advertising rates and, as a consequence, the amount
in media rights they are prepared to pay sporting organisations. In short though,
the value of advertising is inherently linked to audience volume and makeup.
How then are these measured?

Audience measurement: from linear to digital

Relative to audience measurement, there are forms of measurement applied to
both linear and traditional ratings formats, as well as transition towards new
forms of viewing or audience measurement as a result of digital integration.
Established forms of television have for a long time utilised ‘ratings’
measurements inclusive of terminology and measurement which have been well
understood as approximated but accepted ‘currency’ by which to assess broadcast
audiences and returns.
Measures of note in television measurement include homes using television
(HUT) as the number of homes where at least one television set is switched on at
any point in time. Aligned with this are programme ratings or share, which
considers the percentage of households tuned to a particular station at a particular
time. Target audience rating points (TARPs) provide the audience at a given point
in time expressed as a percentage of the potential audience available. Gross rating
points (GRPs) are another cumulative measure, representing the sum of TARPs
for a given schedule. These are relevant over a programme series or group of
related broadcasts, where a cumulative number or average can be calculated.
Reach is a further measure of the number of different people watching; and
frequency is the number of times a person or household watches the same
programme, commercial or station. Measure of average audience is the estimated
audience over a stated period, usually 15 minutes. These figures are usually
expressed in thousands, or translated to a percentage figure.
In terms of the method used to collect ratings data, the process in Australia has
changed from an initial diary system that required randomly selected households
to fill in their viewing patterns. These were then collected and analysed to
determine programme ratings. ACNielsen’s people meter provided a significant
evolution to such tracking. Deployed in a random selection of houses, people
meters were an improvement on the diary system, where the accuracy of data
reported by households was often suspect. However, in the early days, this still
required household members to diligently turn their green and red lights on and
off as they cycled in and out of watching television.
Further innovation has led to more digitalised and automated tracking of
household viewership, and provided television executives with more immediate
feedback on the success of their programming. However, an increasing number of
television sets in households and increasing platforms such as multi-digital and
pay-TV channels have provided a more dynamic and challenging environment
within which to provide accurate audience measurement. From 2009,
measurement began to include ‘playback’ or ‘time-shifted’ viewing – in other
words, programmes that had been recorded and watched within seven days of the
originally scheduled programme. The current evolved version of people meter
systems emerged as OzTAM, a joint venture between the main commercial
broadcasters in Australia, which used sampled data from five major city markets
as well as regional sampling to develop measures of total audiences. Of course,
the focus is not only on the question of how many are watching a programme, but
also on who is watching. Corporations are often just as interested in the detailed
demographic data as these relate to the groups most likely to purchase products.
In other words, if Coca-Cola advertised during a rugby league telecast, the
company might be more interested in the number of people in the 16–24-year age
group watching Friday night matches as this might represent an important buying
group.

Issues in measurement
Methods that have been used in linear measurement commonly involve a
relatively small sample, posited to be representative, and have been widely
adopted as the major focus on television audience measurement. However,
mirrored in global markets, despite developments in analogue and early digital
measurement, there have long been limitations to these systems. The need for,
and issues related to, manual entry was over time mollified; but limitations on
accuracy, as well as understanding how digital streaming and mobile devices
could be integrated, have long presented a need for disruption of the system.
Some issues of accuracy have been enhanced when audience measurement is
considered in digital or streaming settings. Digital behaviours are by nature more
measureable, and the ability to accurately see the number of people watching,
viewing and engaging in real time or on delay, is comparatively easier. It does not
require sampling as complete behaviours of subscription bases are, in theory,
much easier to track. As such, digital tracking provides a much more robust and
reliable form of audience measurement.
 There are other benefits and metrics within digital settings that can be
considered advantageous. Demographic data on the subscriber or consumer,
accurate data on what other programming viewers watch, how they concurrently
engage with connected devices or other apps, and how they respond to click-
through offers or supplementary content are examples. Further, more accurate
data on how much of a programme an individual watched and when they entered
and exited a programme is available via digital streaming measurement. In short,
a greater level of individual-level data can be utilised to measure and report sport
audience and leverage and shape the offerings of the platform, as well as the sport
and commercial partners. In the same way, digital sign-ups as part of a
subscription process offers similar potential to capture, use and report high levels
of quality and in-depth data on subscribers. A sport organisation or streaming
platform may sell access on an annual or weekly basis, but the nature of knowing
who the customer is and what other digital behaviours the subscriber undertakes
are obvious advantages.
However, while the accuracy provided by digital measurement presents
advantages, there remain limitations. Specifically, the nature of fragmented
audiences for sport viewing is potentially problematic. For example, if a sport has
free-to-air and streaming platform measures, are they adequately comparable?
One may use ratings or share, while the other might use streamed minutes.
Therefore, ensuring accuracy between and across measurement forms is
important until such a time as digital streaming is fully adopted. Further, where a
household may share logins, this can cloud the accuracy of individual-level
demographic data. Despite these issues, there is ample confidence that digital
processes represent an advance on audience measurement of decades past.

Summary
This chapter positioned as critical the nature of the sport–business–media
relationship. Media rights to sporting events are one of the most visible and
talked-about components of sport marketing; and media networks and platforms
across the world pay huge sums for the exclusive rights to broadcast events such
as the Olympic Games and World Cup soccer. The stakeholders in sport–media
relationships included rights holders, media organisations and advertisers, as well
as consumers. The complexity of stakeholders is amplified by the growth of
media/broadcast platforms and the fragmentation of modern consumption
options. Specifically, OTT and streaming platforms have joined free-to-air and
pay-TV as prominent distribution forms. For these, business models can be
differentiated, but are generally dependent on subscriptions and/or advertising,
both of which are functions of, or closely related to, audience size.
 Relevant economic factors were introduced, and characteristics impacting
demand for sport content were discussed. It is critical to embed understanding
that sport has much value as a live product, but that the value in sport content,
particularly in the digital setting, extends beyond just the live match or game.
Further, while revenue is one important factor, there is a wide range of
promotional and marketing considerations and opportunities for sport
organisations, media bodies and advertisers. These include other major marketing
benefits such as promotion, exposure and scope to enhance the interactions and
engagement of consumers. Indirectly, televised sport has the potential to attract
viewers to the live event or other forms of consumption, and is therefore an
important consideration when framing marketing and promotion mix decisions.
Finally, aspects of measurement and legislation remain critical considerations.
Given fragmentation in broadcast channels, measurement is inherently more
difficult than in previous years as consumers now use a combination of linear and
digital channels to access sport content. However, the digital environment does
provide opportunities for deeper and more accurate capture of audiences, and
more nuanced understanding of their engagement. Therefore, the way digital has
impacted sport distribution is similar to the impact that will be seen in the various
forms of sport-marketing promotion in the following chapters.

Case Study
Regulation of sport rights: televised sport as a social good?
Sport rights represent major revenue streams for many organisations, and are
primarily how most people engage with commercial or professional sport.
However, despite the commercial growth of sport, sport broadcasts have long
been seen as public goods, or as goods of public interest. This is particularly
true when considering the role of sport for national audiences, where it can play
a defining role in the formation of national identity and collective interest. As
such, we can see how it can be of interest to sports and governments to
maximise access and availability of sport rights to public audiences. In fact,
there is evidence of some rights holders even selling rights for less money to
keep their sports on free-to-air channels (rather than accept more lucrative pay-
TV deals that would limit the availability and visibility of the sports).
Related to this, national broadcasting rights and television licensing markets
are often heavily regulated. In the case of Australia (as well as other global
markets), sport media rights are vastly impacted by tough anti-siphoning rules
designed to ensure sport remains accessible. Concurrently, those laws prevent
pay-TV and pay-for-service platforms from making consumers pay for what is
deemed nationally relevant content.
The Australian Communications Minister has the power to ‘declare’ a
sporting event be listed as a ‘Tier A’ or ‘Tier B’ event. Tier A events include
‘nationally iconic’ events that must be televised live, while Tier B refers to
‘regionally iconic and nationally significant’ events that must be shown within
four hours of kick-off/start time, allowing them to schedule coverage to
maximise audience capture. Protected events on the Australian Anti-Siphoning
List include:

the Olympic and Commonwealth Games

horse races, including the Melbourne Cup
rugby union Test and World Cup matches
cricket Test, one-day international and World Cup matches
FIFA World Cup matches and the World Cup Final
some AFL and NRL matches (including Grand Finals)
tennis tournaments, including the Australian Open
netball World Cup matches (if they involve the senior Australian
representative team)
motor sports, including the Formula 1 Australian Grand Prix, the
Australian MotoGP and the Bathurst 1000 race in the Supercars Series.

By legislating the protection of these events and ensuring they are transmitted as
free-to-air broadcasts, the scheme lowers the risk of subscription broadcasters
obtaining exclusive rights to televise events of national importance and cultural
significance. Inherently, this significantly advantages free-to-air TV networks
and audiences. It also limits the potential pool of buyers for sport rights. For
example, listed sport leagues or events will be limited in the number of
broadcast platforms they can buy rights to, and thus fully showcase their games.
The legislation dates to 1992 when the Broadcasting Services Act detailed
the Australian anti-siphoning rules. Initial rules stated that pay-TV licensees
were unable to acquire rights to televise listed events until such rights have first
been acquired by the Australian Broadcasting Corporation (ABC), the Special
Broadcasting Service (SBS) or commercial free-to-air broadcasters who reach
more than 50 per cent of the Australian population.
The ABC was one group that benefited from this arrangement, as noted in a
2001 position paper:
 As a relatively small and young nation competing against economically
and politically powerful countries with long histories and strong cultural
traditions, sport is one area where Australia has been able to demonstrate
some superior abilities and consolidate a sense of national spirit. Free-to-
air television has helped foster this and the ABC believes audiences should
continue to be offered a wide variety of sporting events on free-to-air
television, particularly events of national significance. (Australian
Broadcasting Authority, 2001)

Over time, the list attracted arguments as to its role and its scope. In 2015,
subscription TV group ASTRA suggested there was scope to remove some events
and sports without significant ‘impact’. ASTRA CEO Andrew Maiden stated in
the Sydney Morning Herald (Mason, 2016):

We accept the politically inevitability of some form of anti-siphoning

scheme. However, the current list of 1300 events includes matches played
overseas and games broadcast to as few as 10,000 viewers. To characterise
these events as nationally iconic stretches credibility well beyond breaking
point.

Aligned with this view, changes to the list have been evidenced. For example,
the English FA Cup Final, finals of the Wimbledon Championships and the US
Open, international netball matches and a number of golf events were removed
from the list in recent years.
However, pending further changes, the current broadcast anti-siphoning list
will remain in effect until April 2023, and perhaps well beyond this time. In
announcing the extension, the Hon Paul Fletcher MP gave a commitment to
continue to review the list ‘as part of its reforms to support broadcasters and
enhance the quality of services and content available to all Australians’. Further,
he noted:

We recognise that many Australians have strong views about being able to
watch culturally significant events for free. It is clear that the current anti-
siphoning list requires review to make sure that it continues to meet the
expectation of Australian audiences. We also need to consider the impact
that COVID-19 has had on how live sporting events are broadcast and the
associated changes in deals negotiated between broadcasters and rights
holders. (Fletcher, 2021)
 The ongoing preservation of the list presents a number of issues and potential
conflicts. There are questions around its impact and the parity it offers to buyers
within sport rights markets. For example, does it unfairly restrict the market for
larger sports, or benefit some broadcasters (e.g., free-to-air) more than other
narrowcasting platforms or OTT buyers. Further questions concern the scope of
the list in terms of whether streaming platforms, given their increasing use and
accessibly, should be considered similarly to free-to-air platforms. In many
cases, major commercial networks have both a commercial free-to-air licence
and a streaming option (e.g., Nine Network and Stan or Network Ten and
Paramount+). This provides some flexibility in terms of how they might buy
and broadcast content that is listed.
Finally, the scope of listed events commonly raises questions as to whether
the listed events are the right ones. Do they represent programmes of national
importance or cultural significance? Who should make this decision, and how?

Questions
1. Do you support the idea of legislating sport rights to ensure sport is visible
and accessible for public audiences? Do you believe it is necessary in the
current environment?
2. Consider the stakeholders of sport media as presented in Figure 8.1.
Controlled media rights may have unintended consequences for some of
these parties. What might some of these be, and how might the view of
different stakeholders differ?
3. Consider other markets you may be familiar with or have access to
research for. Can you find evidence of similar or related legislation? Is
there evidence of how markets or sports are advantaged or disadvantaged
based on the approach they take?
4. Access and consider the current version of Australia’s anti-siphoning list
(or a similar list in your region). Are there any changes you might
recommend in terms of the listed events and how they are structured? What
are the key variables you might consider when assessing whether a sport or
event is of national importance or cultural significance?

References
Australian Broadcasting Authority (2001). Investigation into events on the
anti-siphoning list: Report to the Minister for Communications, Information
Technology and the Arts. ABA, Sydney.
Blake, J. (2016). Television and the second screen: Interactive TV in the age
of social participation. Routledge, London.
Brodie, R.J., Hollebeek, L.D., Juric, B., & Ilic, A. (2011). Customer
engagement: Conceptual domain, fundamental propositions, and
implications for research. Journal of Service Research, 14, 252–271.
Brodie, R.J., Ilic, A., Juric, B., & Hollebeek, L. (2013). Consumer
engagement in a virtual brand community: An exploratory analysis. Journal
of Business Research, 66, 105–114.
Cummins, R.G., Berke, C.K., Moe, A., & Gong, Z. (2019). Sight versus
sound: The differential impact of mediated spectator response in sport
broadcasts. Journal of Broadcasting and Electronic Media, 63(1), 111–129.
Dang, S. (2021, February 11). CBS scores record $545 million in Super
Bowl ad revenue despite low ratings. Reuters.
https://www.reuters.com/article/us-football-nfl-super-bowl-advertising-
idUSKBN2AA2P3.
Fletcher, P. (2021, March 22). Current anti-siphoning list to continue to
2023. https://minister.infrastructure.gov.au/fletcher/media-release/current-
anti-siphoning-list-continue-2023.
Gough, C. (2021, February 11). Super Bowl average costs of a 30-second
TV advertisement from 2002 to 2021. Statista.
https://www.statista.com/statistics/217134/total-advertisement-revenue-of-
super-bowls/.
Hallbäck, R. (2020, October 2). The second screen experience during live
sport: Facebook and Twitter. Anchor Sport Business Advisors.
https://www.anchorsportadvisors.com/post/the-second-screen-experience-
during-live-sport.
Jarratt, P. (1988, October 4). A nation of Norms. The Bulletin, 56–58, 92.
Kaldor, N. (1950). The economic aspects of advertising. Review of
Economic Studies, 18(1), 1–27.
KANTAR. (2021). Now and next in fan engagement: 10 opportunities for
2021.
https://sites.kantar.com/marketing/MONITOR_2021/Sports_MONITOR/Ka
ntar-Sports-MONITOR-Big_Picture-
10_Opportunities_for_Sports_2021.pdf.
Karg, A., McDonald, H., & Leckie, C. (2019). Channel preferences among
sport consumers: Profiling media-dominant consumers. Journal of Sport
Management, 33(4), 303–316.
Klattell, D.A., & Marcus, N. (1988). Sports for sale. Oxford University
Press, New York.
Mason, M. (2016, February 1). Trimming anti-siphoning ‘not good for
Australian viewers’, Seven boss Tim Worner says. Sydney Morning Herald.
https://www.smh.com.au/business/companies/trimming-antisiphoning-not-
good-for-australian-viewers-seven-boss-tim-worner-says-20160201-
gminbo.html.
McDonald, H., & Lock, D. (2017, February 6). Declining sport viewership
shows why we should keep it on free TV. The Conversation.
https://theconversation.com/declining-sport-viewership-shows-why-we-
should-keep-it-on-free-tv-72357#comment_1204167.
Neale, W.C. (1964). The peculiar economics of professional sports.
Quarterly Journal of Economics, 78(1), 1–14.
Noll, R.G. (2007). Broadcasting and team sports. Scottish Journal of
Political Economy, 54(3), 400–421.
Pash, C. (2021, January 15). Analysis: The 2021 Super Bowl advertising
dilemma. AdNews. https://www.adnews.com.au/news/analysis-the-2021-
super-bowl-advertising-dilemma.
Pfeffel, F., Kexel, P., Kexel, C.A., & Ratz, M. (2016). Second screen: User
behaviour of spectators while watching football. Athens Journal of Sports,
3(2), 119–128.
Rucker, D., & Calkins, T. (2013, January 23). Super Bowl advertising’s new
game. Forbes. https://www.forbes.com/sites/onmarketing/2013/01/23/super-
bowl-advertisings-new-game/?sh=3f5675547af6.
Samios, C., & Rugari, V. (2021, June 28). Stan Sport secures UEFA
Champions League, fragments football streaming landscape. Sydney
Morning Herald. https://amp.smh.com.au/business/companies/stan-sport-
secures-uefa-champions-league-fragments-football-streaming-landscape-
20210627-p584l5.html.
Solberg, H.A. (2002). The economics of television sports rights. Europe and
the US: A comparative analysis, Norsk Medietidskrift, 9(2), 59–81.
Todreas, T.M. (1999). Value creation and branding in television’s digital
age. Quorum, Westport, CT.
Tsiotsou, R. (2012). Entrepreneurship in sports broadcasting. In D. Ciletti &
S. Chadwick (eds), Sports entrepreneurship: Theory and practice. Fitness
Information Technology, Morgantown, WV.
Turner, P. (2012). Regulation of professional sport in a changing
broadcasting environment: Australian club and sport broadcaster
perspectives. Sport Management Review, 15(1), 43–59.
Young, K. (2017). Why the second screen in sports is social. We Are Social.
https://wearesocial.com/blog/2017/09/second-screen-sports-social.
CHAPTER 9

Sport promotion

DOI: 10.4324/9781003270522-12

Chapter objectives
Chapter 9 introduces sport promotion as a tool used in an integrated manner
to achieve communications objectives and stimulate demand. It begins by
defining communication and providing a model of communication that
underpins the promotions process. It then considers the development of
promotions, including trends influencing the current promotions landscape. The
importance of an integrated mix is then discussed before the components of the
sport promotions mix are introduced. Traditional elements include advertising,
public relations and publicity, and sales promotions. Digital marketing in sport
is also discussed, enhancing the ways in which marketers engage fans. This
chapter concludes with focus on a process for selecting and developing a sport
promotions mix.
After studying this chapter, you should be able to:

understand the definition of promotions and the nature of promotion as a

communication tool
explain the communication process, aims of promotion and process models
describing cognitive, affective and behavioural stages
understand the importance of a structured, integrated approach to
promotion use
recognise components of the promotion mix and give examples of each
establish procedures and articulate the process for selecting and planning a
promotions mix
understand standards to assess the suitability of a promotions mix.

Headline story
BBQs and superheroes: the changing face of cricket promotion
The case of promoting shorter formats of cricket to the modern Australian
audience highlights changes in the communicated messages over different time
periods, as well as different promotional mix options available to sport
marketers. While traditional forms of the game were limited to basic white
uniforms and matches that would span a few days, formats such as 50-over
One-Day International (ODI) and 20-over (Twenty20/T20) have emerged which
have enabled new, innovative opportunities to promote the sport.
In Australia, the governing body and custodians for the sport, Cricket
Australia (CA), began to promote the 50-over game with the ‘Summer’s Biggest
Dress-Up Party’, which focused on the Australian summer themes of barbecues
and backyard sport. Distinct from previous promotions that emphasised the on-
field product, this specific campaign did not show match highlights and barely
featured athletes. Instead, it emphasised a house party with enthusiastic guests,
 DJs, drinks and a few recognisable players warming up for a backyard game for
good measure. The success of this promotion was in its clearly defined
communication of the social experience of the sport event, and a movement
away from the sport and its athletes as its core.
However, T20, a faster, more high-powered variant, arrived on the global
cricket scene and change was required to frame this new offering to fans.
Specifically, the cricket calendar was now saturated with multiple products –
Tests, ODIs, T20 – and Cricket Australia had a keen opportunity to promote the
game to a new demographic, families and kids. The resulting promotional
campaign was named the ‘League of Heroes’, focusing on the extraordinary
abilities of athletes playing in Australia’s T20 format, the Big Bash League
(BBL). Unlike the Dress-Up Party, the League of Heroes emphasised a family-
friendly environment full of colour, music and fun. The ensuing television
campaign focused on youth fans in the crowd, painted faces, wigs and
noisemakers, as well as images of lightning, electricity and pyrotechnics.
In short, these campaigns send very different messages to fans in the market.
Cricket Australia targets young professionals looking to enjoy the summertime
environment and themes associated like barbeques, drinking and engaging with
friends with its 50-over product. Conversely, the organisation focuses on the
next generation of fan through its T20 product, highlighting the family fun at
this short-form product. In both cases, Cricket Australia is able to connect
different products to two entirely different groups, expanding its core base of
consumers.

Defining promotion
Promotion is the way sport marketers communicate with potential consumers to
achieve communication objectives such as informing, reminding and persuading.
Promotional campaigns like those in the cricket example above commonly utilise
many integrated tools to contribute to awareness, image, consideration or sales
goals that ultimately contribute to organisational success and sustainability.
Promotional goals can focus on a wide range of outcomes: from encouraging
consumers to become aware of product or service offerings, to communicating
features and benefits of new or enhanced products, to articulating competitive
advantages. Further, promotion can reinforce the position of a brand or
organisation; it can make customers aware of important information, such as
distribution channels; or it can be used to help develop favourable opinions with
the intention of stimulating consumers to purchase or use a product or service.
 As such, promotions must communicate a distinct and clear ability to fulfil
customer needs, with a view to ultimately creating demand for consumption
within a market. A promotional strategy is defined as an integrated programme of
communication activities to present an organisation and its products or services to
customers (Belch & Belch, 2021). This may be focused on creating generic
demand for a particular product category (for example, an industry-wide focus on
communicating health and fitness benefits) or brand demand relevant to a more
specific organisational unit (a specific club, programme or association).
Additionally, a manufacturer may promote one element of a product, which might
stimulate demand for that component, and indirectly stimulate demand for a
particular brand. For example, Lycra manufacturers promote the attributes of
Lycra, which indirectly stimulates demand for products made using the fabric,
such as fitness and cycling apparel.
Irrespective of the type of demand, the audience targeted by the promotion
strategy invariably remains the same. Current and future customers, stockholders,
the public at large and special-interest groups are all existing or potential
consumers. However, responses to promotion strategies will vary based on
myriad consumer behavioural factors and models of response to messages. Given
such differences, sport promoters need to tailor marketing strategies in order to
attract specific consumer groups. This is achieved by fully comprehending the
stages of promotion-strategy development, and then manipulating the promotion
mix to suit target segments.
There are many kinds of promotional activities that can be used
simultaneously as part of a promotion or integrated marketing communication
(IMC) mix. Well-planned and executed promotional strategies should comprise a
range of ‘seller-initiated efforts’ that can access channels to inform and persuade
(Ray, 1982). The controlled and integrated nature of a promotional strategy
requires careful consideration of aspects such as alignment with wider marketing
objectives and message and strategic integration, as well as timeframes, cost or
budgets and quality of message and creative elements.
It is important from the outset to differentiate between the wider marketing
strategy and the promotional strategy. The latter is only one of many of the ‘Ps’ of
marketing, and is limited to the communication strategies inherent in a wider
marketing strategy. Marketing objectives of a sport organisation may include
increasing market share, participation or revenue. While promotional objectives
should be aligned, they should be focused on specific communication objectives
that can help deliver these broader, higher-level outcomes. Although promotion is
impacted by price, place and product, the aim of promotion – to inform, persuade
and remind – clearly demonstrates that it is a communication tool within the
wider strategic marketing mix.

Communications model
In order for promotional strategies to have their desired impact, they must
successfully transfer messages through a communication process. An
understanding of how a message is transmitted and the processes by which the
consumer receives and processes communication is required in order to
adequately develop relevant strategies. Communication is said to have taken
place once information processing has occurred – that is, once an individual
attends to a message and attributes importance to it (Cravens & Piercy, 2012).
The key components in the sport communication process are the source, the
message, the channel and the receiver (Pedersen et al., 2021). The process begins
with the sender or source, which may be an organisation or individual. Once the
context has been established, any resulting message is encoded by its source and
decoded by its receiver. Messages do not always need to be verbal, as non-verbal
cues are often just as prevalent. The use of visual scenes containing previous elite
performance or competition to promote an upcoming event is an example of a
non-verbal message.
The message or content is executed and communicated via a channel.
Channels can be any kind of medium, ranging from personal, customised
communications delivered face to face, to digital means such as email and social
media platforms; or physical forms such as letters, brochures or sales tools. In this
sense, the communication can take the form of a one-to-one or one-to-many
interaction. Considering message, often the more effective sport promotions use
simple, non-confrontational, unambiguous messages to highlight a service or
product. Nike’s ‘Just do it’ is an example of this. Likewise, Indian Premier
League (cricket) team Rajasthan Royals use Halla Bol (‘Raise your voice’), a
basic but powerful message around which to centre fan communications
campaigns.
The final element – the receiver’s perception following decoding – may then
be shared or transmitted further. While the complexity in communication arises in
the encoding and decoding processes, the components remain the same for a
variety of communication examples. In a traditional advertising context, the
message may be delivered to the consumer through radio, television, billboards
and print media. As a further extension, an original recipient of a message may
also become a source – for example, if the recipient were to share the message
within their own network. The message can be transmitted and received by
individuals or networks in the same manner, either through word of mouth or via
digital means (for example, through social networks). Thus messages originating
from trustworthy sources – whether they are brands or individuals (friends or
endorsing athletes) – can play a big role in the success of the communication and
its reception.
Consumers are often faced with highly cluttered markets, and are exposed to
multiple brands, products and messages each day, or even each hour. The greatest
inhibitor or source of interference to successful message conveyance is noise.
Noise can be physical or psychological, or simply an unintended interpretation or
decoding of a message. There is therefore a need for targeted placement, as well
as for clear, consistent, reinforced messages that will be received in the best
possible way by consumers.

SPORTVIEW 9.1
Endorsements: athletes as communication sources
Endorsements are an increasingly common form of promoting products and
services through leveraging the popularity of a sportsperson or athlete. Similar
to sponsorship and product placement, an athlete is retained as the spokesperson
or ‘face’ of a brand. The process seeks to gain attention and awareness, and to
transfer the goodwill and image of the individual to the brand itself. As such, fit
or congruence between the two parties – either in product or brand traits – is
sought.
As an example, BioSteel, a sports nutrition brand, has been endorsed in
Canada by a range of athletes and personalities (past and present), including ice
hockey legend Wayne Gretzky, perennial basketball all-star Andrew Wiggins
and double Olympic gold medallist in trampoline, Rosie MacLennan. Specific
products from BioSteel’s five-category range (hydration, proteins, everyday
essentials, stackables and merchandise) have been aligned with relevant
athletes, such as MacLennan (a notable vegan) and its plant-based protein
supplements, with mass media advertising used to leverage the endorsement
strategy. These campaigns have helped propel BioSteel as a major player in a
highly competitive space with incumbents like Pepsi-Co (Gatorade) and Coca-
Cola (Powerade). In this case, the athlete is a communication source, and
delivers a message that seeks to raise awareness, details the product benefits and
encourages consumers to purchase.
The use of an athlete to convey messages about a product seeks to create a
more memorable communications experience, ideally leveraging the source’s
 credibility and value as a brand ambassador. But what are the characteristics
that drive this connection? Organisations need to consider the choice of athlete
carefully, as the arrangement can quickly turn negative if the athlete is involved
in a scandal or exhibits poor behaviour. Commonly, organisations use the
dimensions of awareness, likeability, trust and appeal to consider how an athlete
might influence brand affinity, consumer behaviour and purchase intent.

The primary desired outcome of communication is to produce a favourable

change in attitudes and behaviour. There are several communication response
models that explicate progress through a number of affective, cognitive and
behavioural stages in processing. These are relevant as a foundation for
understanding how messages are developed and decisions made regarding the
selection of promotional elements. Perhaps the most prominent is the AIDA
(awareness, interest, desire, action) model. In this instance, the promotion aims to
get the consumer’s attention, create an interest in and desire to purchase the
product or service, and stimulate action by engaging in an exchange process –
usually involving actual purchase. A hierarchy of effects model, commonly
applied to the understanding of sponsorship, uses a similar process. Here,
typically over a period of time and with supporting activities, sponsorship
between a brand (for example, a bank) and a sports organisation (for example, a
professional football team) seeks to first generate awareness and knowledge of
the parties and the relationship. From here, the sponsor (the bank) seeks to
leverage the goodwill that the consumer (the fan) has for the sponsee (the team)
in order to progress liking, preference and conviction before consideration of
positive behaviour, such as consumption or usage. Other examples include
innovation-adoption and information-processing models (Belch & Belch, 2021).
All of these models seek to describe the way in which consumers progress from
awareness through varied levels of consideration to positive actions.

Towards a strategic, integrated promotional mix

Sport promotions represent the most visible component of the sport marketing
mix, in many cases presenting to markets the end results of a process of strategy
and planning around how the organisation wishes to communicate with
consumers. The promotional process and the elements used to communicate can
vary, depending on: the target market; the stage of the product life-cycle; the
message or marketing goals of a company at a certain time; the positioning
strategy the brand wishes to adopt; and the budget and timeframe. The
complexity of planning and executing promotional strategy emerges from this,
with potentially variant messages required for different groups of consumers and
target markets.
Accordingly, promotional mixes must embrace strategic and planned
communications that play a fundamental role in generating interest and achieving
marketing and organisational goals, rather than take the form of a series of
attention-grabbing or entertaining activities. The high-profile role played by sport
in consumers’ lives and the level of media attention that sport garners are
advantages in achieving this aim. However, while a high profile is an advantage
for reach and exposure, there is a need to leverage such benefits to create
conversations, share information, generate interest and, ultimately, drive action
towards purchase and usage of sport products and services.
The use of sport promotions dates back to the 1800s (Mullin et al., 2014),
while later, in the 1940s and 1950s, American sports marketing entrepreneur Bill
Veeck became known for unique and innovative marketing actions to help
generate sales (see Veeck & Linn, 1962). In Australia, the comparatively late
professionalisation of sports meant that a more strategic and concentrated
adoption by sport organisations of promotional strategies did not take place until
the 1970s. This was a time characterised by major shifts and innovations in sport
products, with the introduction of night games, more TV and fan-friendly
conditions, media and corporate brands leveraging the popularity of sport, and a
focus on leveraging highly marketable personalities. From this age arose some of
the more iconic Australian sport marketing campaigns, including the National
Rugby League’s ‘Simply the Best’ and the Australian Football League’s
‘Unbelievable’.
Since that time, there have been a number of important developments and
trends in marketing theory and in the sport environment that have impacted the
ways in which promotional mixes are designed and operationalised.
Organisations and marketing managers now face demands for greater
accountability and objectivity; further, there has been a shift in power from
manufacturers to retailers (including online retailers), who have sought greater
involvement as distribution partners. Developments in communications and
marketing theory have led to a greater focus on relationship marketing as opposed
to stimulating transactional activities. Additionally, there has been support for
strategic and integrated suites of activities that are complementary and
synergistic. In line with this, marketing communications have shifted away from
a reliance on mass media advertising spend, and have embraced a wider range of
existing tools and components – some of which have proven to be more
measurable, interactive, customisable and effective.
 New technologies have also added a stream of possibilities in direct, online or
digitalised communication formats. In the digitalised context, the growth and
development of direct and interactive marketing, along with the use of customer
relationship management (CRM) platforms and databases, has provided
organisations with more personal and focused approaches to build relationships,
generate sales and achieve other marketing goals within an established market
(Green, 2019). The emergence of social media has also provided a unique stream
of possibility for sport organisations to connect with stakeholders beyond just
fans, including athletes, sponsors and government partners, all at the same time
(Naraine and Parent, 2016b). Such digital techniques also provide scope for a
greater use of segmentation tools and better-developed relationship marketing
initiatives (Naraine, 2019a). As such, it is now a rarity to see a marketing
campaign, promotion or piece of communication from a sport organisation that
does not include some sort of digital component.
Overall, these changes have both increased the promotional options available
for marketing managers and elevated the focus on integrated promotional
campaigns to deliver consistent, reinforced messages using diverse tools.

Tools for promotion

As a result of the processes of commercialisation and professionalisation, sport
has become a source of entertainment, an occupation and a lifestyle; in addition,
sport must continue to generate revenue and reach levels of profitability in order
to guarantee the sustainability of organisations. Marketers are faced with an
increasingly cluttered marketplace, as well as a need to deliver accountability,
while consumers have more options and modes of consumption. As such, sport
organisations’ scarce marketing budgets, variety of goals and wide-ranging
stakeholders have increased the reliance on promotion and communication as
vital tools with which to communicate effectively with stakeholder groups and
customers.
In recent years, the variety of promotional mix variables has diversified. In
line with this, a promotional strategy is now best conceived of as an IMC mix.
The use and terminology of IMC encourages a comprehensive, strategic approach
to the communications process, such that promotional campaigns rarely feature
only one component; rather, they tend to be a cohesive, synergistic mix of
communication actions.
The use of IMC reinforces the view that a modern promotion mix is more than
just a mass advertising approach; it integrates a number of interrelated activities
that exhibit consistency of message and alignment with objectives of the
organisation and that use various forms of communication. Additionally, target
audiences are likely to be channel-agnostic, meaning that they do not rely solely
on any single channel for communications (for example, print, online, offline,
mobile, social). As such, organisations wishing to both enforce consistent
messages and reach a wide range of markets should use a mix of tools.
The focus now turns to introducing the various communication or promotion
tools available to sport marketers:

advertising
public relations and publicity
sales promotions
personal selling
direct marketing
promotional licensing
digital marketing.

Advertising
Advertising represents the obvious form of sport and event promotion, and is
defined as a form of one-way communication where a marketer pays someone
else to have their product, brand or organisation identified. In its traditional form
it is a non-customised, one-to-many, mass media promotion tool (that is, all
consumers receive the same message), the success of which is heavily reliant on
brand identification, clarity of message, visual or audio stimulants, and generating
impact and reach through media decisions about placement.
Common examples of advertising include television commercials, magazine
and newspaper advertisements, radio spots, website pop-ups or static adverts,
social media advertisements and outdoor advertisements such as on billboards or
public transport vehicles and shelters. Traditionally, TV or other media have
garnered the largest share of advertising spend; however, as a promotional tool
and revenue stream, digital advertising now generates the largest growth rates,
with considerable spend through Google and Amazon services.
While the sport organisation, event or brand may choose to advertise its
products or services through any of these means, venues and other physical
locations also provide opportunities for sport organisations to generate revenue
through the sale of advertising opportunities. Specific to sport, some of these
include advertising opportunities through scoreboards and the playing field. For
instance, in Der Klassiker – the name given to football matches between the
German teams Bayern Munich and Borussia Dortmund – multiple advertisers are
displayed on the LED banner signage set up at field level (around the perimeter of
the pitch), and some even paint their brands in three-dimensional perspectives,
targeting fans in the stadium and watching on television.

Public relations and publicity

Public relations (PR) relates to the determining of various publics’ attitudes and
interests, and the subsequent implementation of media and communication
strategies to disseminate core information and announcements related to
organisational activities (Stoldt et al., 2021). Ultimately, it seeks to draw attention
to, or shape attitudes and perceptions towards, a person, product, organisation or
event. Some of these objectives may be to raise awareness, inform and educate,
develop understanding or trust, or assist in motivating consumers or incentivising
purchase. While marketing and PR traditionally have been distinct in their
structure and operations, increasingly PR is a fully integrated element of the
communication strategies of organisations – particularly where PR has brand- or
marketing-related objectives.
Importantly, PR can be both proactive and reactive in nature. For example, a
small organisation may seek to develop a profile or awareness of an upcoming
event by creating a newsworthy angle that will attract media outlets to carry the
story. Alternatively, an organisation may seek to react to positive or negative
news about competitors, or to issues or situations – such as player misbehaviour
or other prominent stories surrounding a team, player or event.
The process of conducting and integrating PR into the promotional mix
involves:

developing an understanding of public attitudes about the organisation and

its products
establishing a PR plan
detailing the tools and strategies for implementation, and
developing and executing the PR programme.

Particularly in this latter sense, publicity is closely aligned to PR as it involves the

generation of news about people, products or services through the broadcast or
print media. The best example of this is the amount of copy, space and time given
to sport and related activities in the media. For instance, a major sporting event
such as an F1 Grand Prix permeates sport and other news and cultural domains.
Although more immediate, publicity objectives are also more short term, and can
often be generated by sources outside the control of the organisation.
PR also has the advantage of being viewed as more credible and cost-effective
than advertising, and is able to overcome the clutter associated with other media
and advertising by communicating through different channels (that is, away from
paid messages). The outgoing messages can be controlled and directed by the
organisation concerned, targeted to a specific market and measured reasonably
effectively through public perceptions and reactions. Likewise, publicity has the
advantage of being free – or at least more cost-effective. However, while the
message from the organisation (for example, through press releases or statements)
can be controlled, ultimately the organisation cannot control the time and
placement of the story, or the slant a particular journalist or writer may place on
it.

Sales promotions
A sales promotion is a short-term activity with the primary objective of providing
an enticement or incentive to purchase, or of stimulating a short-term or
immediate increase in sales. Consumer-focused promotions include samples,
coupons, premiums, contests, sweepstakes, refunds and rebates, bonus packs,
price-offs, loyalty programmes and event marketing. They can involve the
creation of value through either price or non-price approaches.
Sales promotions based on price can include two-for-one deals, group or
packaged discounts, or free product trials. Often these are directed towards
children, which influences family attendance and consumption, or other segments
of new or casual users. For example, sport teams or leagues may reduce ticket
prices for games later in the season or for those with lower demand in order to
attract new fans or people who only attend sporadically. Such a strategy seeks to
communicate affordability and added perceived value while giving the
organisation opportunities to use other strategies within the game experience to
convert such fans into relational customers.
The use of giveaways – such as caps, drink bottles, posters or, the most
popular modern giveaway, bobbleheads – is an example of non-price promotions,
where additional value is offered to attendees. Other examples of sales
promotions include the chance to enter a draw or win a prize, which can double as
at-ground entertainment. For instance, it is common for one lucky attendee to
have a chance to win cash or prizes by making a half-court shot in basketball or
kicking a field goal in American football from 50 yards (46 metres) out.
In these instances, integration becomes possible as a brand or sponsor may
partner the promotion. For example, in US collegiate basketball, a particular
sponsor will cover a student’s tuition if they can make a half-court shot during
half-time. Additionally, sales promotions can be activated by non-sport brands
and products – that is, a case of marketing through sport. A successful example of
this is the case of the Budweiser goal lights that were given away with purchases
of the brand’s beer during the 2018 PyeongChang Winter Olympic Games. The
lights, mimicking the ice hockey lights that turn on to signal a goal is scored,
were integrated with Canada’s ice hockey teams such that they would light up
when a goal was scored in real life. Sales of Budweiser products spiked during
the Games, which was especially important as the company was not an official
supplier or sponsor of Team Canada. Sales retuned to par in subsequent parts of
the year, demonstrating that a sales promotion’s primary effectiveness is as a
short-term transactional tool that requires more attention to turn product trials into
sustainable revenue or sales sources.
While sales promotions are most commonly used to target consumers as an
incentive, bonus or additional value-add to buy the sport product, they can also be
relevant for retailers or trade partners within the distribution network. This makes
sales promotions effective tools at multiple points of the marketing distribution
channel. Trade-oriented promotions include contests and dealer incentives, trade
allowances, provision of point-of-purchase/sale displays, training programmes,
trade shows and cooperative advertising. In fact, sales promotions – particularly
for sporting goods – often need the assistance of retail or distribution partners to
be effective. For example, a two-for-one purchase of items such as shoes or packs
of tennis balls needs to be activated in-store or at the point of purchase, requiring
the support of retail partners.

SPORTVIEW 9.2
A promotion a day: promotions in Minor League Baseball
Consider the job of marketers for Major League Baseball (MLB) clubs. Each
team plays 162 games in a regular season, with 81 home games spread
throughout weekdays and weekends, and afternoon and evening affairs. Even
when factoring in the most loyal fan bases and attendees, it becomes necessary
to focus attention on a wide range of fan segments to generate crowds for each
game. As such, a creative range of sales promotions becomes a key tool to
deliver additional value and incentives that keep bringing fans to ballparks.
Looking at many team schedules, many home stands are highlighted by a
specific promotional event. The event might be linked to giveaways or special
offers for a certain number of attendees; it may celebrate a historic figure,
anniversary or cultural heritage; or it may be targeted at a specific fan group or
sponsor.
Additionally, at the Minor League level of baseball (MiLB), there is a similar
need to use promotions for the same outcomes. Here, the quality of play is
lower than in MLB games, and many teams reside in smaller markets. The
 challenge of developing creativity in promotions at this level has been met by
teams’ marketers, resulting in some innovative concepts. Among them have
been ‘Silent Night, where fans were encouraged not to talk or cheer creating a
silent atmosphere, and ‘Second Chance Night’, which allowed traffic violators
or those with fines to purchase two-for-one tickets. This night also included free
entry for probation officers, and mug-shots and holding cells as part of the
entertainment. Finally, ‘George Costanza Night’ was held in honour of an
episode of the TV show Seinfeld in which a character does everything opposite
to the way he would normally, with great success. As a tribute, everything at a
particular game was done backwards. This included use of the scoreboard; fans
being rewarded rather than paying for parking; tiers of seating prices being
inverted; players wearing opposite home and away uniforms; and the night
concluding with players asking for fans’ autographs.
In all these cases, from sponsor-engaged nights to other themed events, the
characteristics of sales promotions are visible and consistent. Organisations seek
to induce short-term responses or impacts on sales by temporarily offering
additional value or incentives.

In both the consumer and trade sense, sales promotions are a good example of an
integrated form of promotion in that they are generally supported through other
areas of the promotions mix. Here, advertising, personal selling, PR and publicity
may form part of the process of building awareness and distributing coupons or
physical vouchers that facilitate sales. This represents one of the advantages of
sales promotions: measurability of the investment made in sales promotions
through the inbuilt ability to track respondents and their resultant behaviour. By
recording the number of vouchers or coupons used, or the number of times a
promotional code is entered, organisations can track customer response, and
ideally determine future promotions for customers. As such, while sales
promotions are generally temporary in nature, measurement can provide evidence
of developed long-term customer relationships as a result of introductory
approaches.

Personal selling
Personal selling involves selling through individual and personal communication,
usually over the phone, face to face or through an internet portal. It is explained
as a systematic process of identifying prospects and needs, determining and
communicating a strategy, and evaluation (Evans & Berman, 1987).
 Personal selling to consumers is most relevant in certain circumstances and for
certain forms or types of goods and services – for example, where product
purchase is a complex or highly involved decision, or where features may require
demonstration, trial or a greater level of information than delivered in advertising.
Personal selling is also appropriate in situations where aspects of the product can
be customised, or where price is flexible or negotiated. Some examples of
appropriate uses of personal selling may involve expensive equipment such as
golf clubs (where trial is important) or high-involvement products such as season
tickets (which require both consumers’ money and time), where there may be a
need to explain benefits to new consumer or acquisition targets.
While personal selling is an important aspect of promotion, it is often linked
with other IMC activities to maximise its impact – for example, it can be
combined with advertising campaigns or PR to generate leads, initial awareness
or interest. The direct and interpersonal communication aspects of personal
selling often make it a resource-heavy component of promotion. Developing trust
and effective relationships can require much time and effort; however, this can be
offset by the benefits of direct and immediate interpersonal communication,
which enable the customisation of the marketing message and provide immediate
feedback on the sales target as well as on the product and service. For example, a
telemarketer selling a product can adapt the sales message to suit the motivations
of the consumer, or can adjust the positioning of product benefits or
communications to better handle objections.
In the context of sport, personal selling is also commonly associated with
business-to-business (B2B) activities such as sponsorship, corporate hospitality
and trade or licensing arrangements. In particular, sponsorship – as a mutually
beneficial partnership – is heavily reliant on face-to-face presentation and
communication, at the selling and negotiation stages as well as in servicing and
renegotiation. Examples can be found in corporations such as India’s Hero Honda
and China’s Vivo and their relationships with the Board of Control for Cricket
(BCCI) in India, the Pro Kabbadi League and both the Indian Super League and
the I-League (global football). Such organisations make significant investments in
sport, and are engaged in often very complex relationships requiring a high level
of negotiation and personal communication.
As personal selling is usually stimulated through accessing an existing data
set, a knowledge base exists about consumption patterns. Therefore, there are
opportunities to upgrade or upsell to existing consumers, or to target lapsed ones.
In some cases, the outcome may not always be sales; but, in line with
communications objectives, personal communication with a consumer may
initiate interest or increase consideration. Additionally, personal communication
can help a data-collection process acquire information about positive and negative
experiences, guide future intentions and barriers to purchase, understand
motivations for disengagement or become aware of service issues – all useful
insights with which to frame future marketing strategies.

Direct marketing
Direct opportunities to sell to consumers may be through personal selling
scenarios, but can also take the form of direct marketing through other media.
Direct marketing is defined as one-to-one communication of a personalised
message to a consumer, with the purpose of eliciting a direct response or sale. As
opposed to mass media advertising, such as a television advertisements or
billboards, after identifying the consumer as a relevant part of a target market, the
message is directed towards that specific consumer. It therefore removes the third
party from the communication process, directly communicating messages to
consumers and allowing detailed and customised interaction to communicate
information about products and services that may satisfy identified consumer
needs.
The media by which direct marketing approaches are communicated are not
channel-defined, and are more diverse than in past decades, largely as a result of
changes to marketing theory and improved technology and database capacities.
Previously, door-to-door or telemarketing (overlapping with personal selling) and
direct mail campaigns (using physical brochures and mail order) represented the
dominant forms of direct marketing. These were complemented with home
shopping channels and text messages, also known as short message services or
SMS. Today, direct marketing also involves a suite of activities including
database communications and email marketing, direct-response advertisements,
and the use of internet and broadcast platforms such as websites and forums (e.g.,
reddit).
While the channels that support digital marketing are constantly evolving, the
principles or conceptual approach of direct marketing practice remain the same. It
is defined by communications that are personalised, data- or research-led and
highly measurable (Direct Marketing Association, 2011) and that seek to elicit a
direct response (Kotler & Armstrong, 2017). Direct marketing has seen a recent
surge in growth in its share of marketing spend, given the importance of digital
platforms and its high return on investment.
In the case of direct marketing, email approaches can be facilitated through
CRM platforms. Such tools, commonly used to manage customers, are now
essential for modern organisations to record, track and communicate with their
customers, and to generate database-led promotions. Such databases provide past
consumption and behavioural data to complement segmentation, and can be
combined with interfaces that produce and distribute high volumes of automated
communications that are delivered via email or other platforms (Green, 2019).
Thus targeted approaches can be made to consumers to generate activation or
reactivation, retention and promotion.
Most commonly, CRM programmes have been embraced by organisations
with regular users or buyers – for example, fitness centres, teams and associations
– to manage their member bases. However, the use of database or CRM platforms
should not be limited to subscription services, and should represent both
transactional and relationship customers. Additionally, direct marketing should be
seen as only one function of CRM, with service, support, measurement, planning
and tracking also highly relevant. Further, CRM can seek to better understand
consumer bases to appease and support sponsors, help conduct and record survey
responses and feedback, and help develop and facilitate rewards and loyalty
programmes.

Promotional licensing
Promotional licensing involves granting another party permission to use a
marque, name, symbol or likeness (Irwin et al., 2008). It is defined by a
partnership, and driven by marketing and promotional goals between licensors
and licensees with regard to the contractual right to use the name or logo of a
sporting organisation. The partnership seeks benefits in provision of exposure,
revenue for the organisation and its licensing agent, and opportunities to leverage
and build the brand equity of the sport. Licensing strategies as a form of
promotion date back to the 1920s, with major growth seen in the late 1990s.
Globally, licensed product revenue accounts for approximately 15 per cent of all
sport revenue, with the segment’s worth estimated to reach around $48 billion in
2024.
The success of licensing is dependent on the equity of a sporting brand as well
as fan identification and emotional attachment. As discussed in a previous
chapter, one aspect of psychological attachment defined by Funk and James
(2004) is the ‘sign’. This refers to the behaviour of sport consumers in identifying
with their favourite teams through display of merchandise and clothing. Items
such as caps, shirts, jackets, scarves and key-rings are examples of ‘signs’; but the
array of licensing products is extremely diverse, with supermarkets, gas/petrol
stations and even home-improvement stores often providing consumers with
options to purchase licensed products. For example, organisations such as the
National Football League can have hundreds or thousands of licensed products,
requiring the management of several complex contracts and partnerships.
Licensing programmes provide substantial opportunities and risks for both the
licensee and the licensor, so need to be managed carefully.

Digital marketing
As previously indicated, there is now a stream of possibilities for sport marketers
to promote through digitalised formats. In many cases, digital marketing options
are championed over other promotional forms for their ability to be interactive,
engaging consumers with personalised or customised content. While digital
marketing schemes can include real-time, synchronous engagements, they can
also target consumers when they themselves are seeking content, such as
commute periods in the early morning and evenings (Naraine et al., 2019). This
behaviour coincides with the ‘second-screen’ phenomenon, where sports fans
consume sport live or via television but simultaneously engage with digital
products like fantasy sports, social media and other mobile apps.
The content that consumers can access through these various digital products
ranges from additional highlights, a choice of camera angles to support or
customise viewing, statistics, news and interviews, all of which can be packaged
and delivered on demand. These content pieces could also serve as a source of
interactivity between consumers and the team or sport organisation, through the
products mentioned above. Specifically, Naraine and Parent (2016a) outlined the
‘RIP’ method – reporting, informing and promoting – for social media content.
Reporting refers to content that provides news and updates to fans; informing
content contains scores, standings and related pieces; and promoting content
refers to sponsored posts, charity events and other similar B2B functions.
Additionally, content marketing pieces may also manifest through fantasy –
the consumer activity (predominantly played on a second screen) where
participants manage a fictional team of chosen or assigned players and make the
decisions of a coach or manager. These fictional teams compile points based on
the performance and statistics of the actual players. Fantasy sport has developed
into a wildly popular complement to traditional forms of sport consumption, and
has become a great way for leagues, teams and brands to promote their products
to consumers. Fantasy sport participants are avid consumers (Dwyer, 2011), thus
making them ripe for other brands to target. For instance, sports gambling has
increased its digital marketing presence (Stadder & Naraine, 2020), and the
alignment with fantasy could be one way to drive consumer traffic to those
services.
However, digital marketing does not necessarily require a second screen. The
role of e-commerce in sport is large and complex, swelled by increased access to
the internet through Wi-Fi, 4G/5G technology and high-speed fibre networks
(Naraine et al., 2020). Major e-commerce sites like Amazon generate billions in
revenue specific to sport, and other players such as JD Sports, Nike and Dick’s
Sporting Goods have also been able to generate billions of dollars in revenue.
This growth has led marketers to target consumers via these sites, and digital
advertising spend is expected to be $517 billion worldwide by 2023 (Enberg,
2019). What makes modern e-commerce and digital advertising unique is how
tailored these ads have become for consumers. A decade (or two) ago, consumers
would be subjected to a range of digital advertisements that did not meet their
needs or fit their target demographic. Today, digital advertisements are built on a
foundation of algorithms, selectively targeting consumers as they navigate
through the online space. For example, a consumer in New Zealand planning a
trip to Norway might Google search for various Norwegian activities, including
visiting fjords, snowshoeing and skiing. Because of their search for ‘skiing’, it is
possible that digital ads might appear on certain webpages featuring local ski
clubs in New Zealand as well as ski-equipment shops in Norway. In turn, the
consumer could potentially click on those targeted advertisements and begin to
shop on those e-commerce sites. Additionally, searches for the trip to Norway
might appear as digital advertisements later on while the consumer is casually
shopping for groceries and clothing on Amazon.com.

The promotions process

This section introduces the process used to develop a promotion, or integrated
marketing communication (IMC), mix. The development of strategic promotional
programmes requires a systematic promotions process, which involves the
identification of aims or objectives, the selection and development of tools to be
used and the assessment of those tools. Given that multiple, integrated elements
of a promotional mix are deployed, it is necessary to use various media outlets
and organisational resources to produce and implement the required strategy. For
example, in a large sporting organisation, a senior or general manager may
oversee and approve the development of a promotional plan that includes
elements of advertising, public relations and new media. In implementing this
campaign, the resources of multiple sub-functions of the organisation – including
marketing, brand, information technology (IT) and media staff – may be required.
Additionally, external organisations, such as advertising or digital agencies, may
also perform the required activities. This complexity requires careful and detailed
planning and activation.
The promotion process is one that develops a comprehensive, strategic
approach to the integrated communication process, combining people, funds and
communication strategies. While promotion is only a single ‘P’ of the marketing
mix, and represents only one part of the strategic marketing mix, it still comprises
defined development, implementation and measurement stages. Figure 9.1 shows
the promotional planning process, including situation analysis, objective
development, programme development/implementation and an evaluative
measurement loop.

Figure 9.1 Sport promotion process

Situation analysis
Building on the work done as part of the situation analysis for the overall
marketing plan, the promotional process requires an understanding of the internal
and external factors that allow an organisation to leverage its internal capacities
within its market. These stages include a review of the internal and external
environments and marketing plan to determine the strengths, weaknesses,
opportunities and threats (SWOT) that may be particularly relevant to the
organisation’s promotional efforts. Some examples might include: identification
of financial and skill-based resources and gaps within the organisation or
marketing team; consumer insights relevant to message and communication
planning; particular technologies or existing partnerships that may be leveraged
for promotion gain; identification of current promotional efforts; and any
successful or non-successful impact of past programmes.

Objective development
The processes of setting objectives are vital to the strategic development of a
promotional campaign. Objective setting represents specific statements about
what the IMC programme aims to accomplish at a given point in time. While
promotional or IMC goals should reflect the broader organisational marketing
goals of an organisation, promotional objectives are much narrower and more
focused than higher-level marketing and organisational objectives. Promotional
objectives traditionally focus on stimulating interest, awareness and purchase
(Mullin et al., 2014) through communicating, informing and reminding
consumers of the benefits of products or services. They should be linked to a
particular target market or markets; they should state clearly what the IMC
programme should accomplish in terms of communication strategies; and they
should include measurable targets.

Programme development and implementation

The development of the IMC programme includes the tasks, schedules and
responsibilities that ‘operationalise’ the plan or bring it into action. The strategy
for the creative elements and the key message are both decided at this point, and
choices are made about the platforms to be used, which media will be included,
the timing of activities and how the components will be integrated. Equally
important is the creation of synergies across the promotional mix and the timing
and resource allocation to optimise the impact of communications. Programme
development overall seeks to connect promotional objectives with the promotions
mix, including development of action and implementation charts, project
timelines and budgets that seek to operationalise the steps required to achieve
communication goals.
Resources and budgets allocated and committed to the plan are also developed
at this point. The establishment of budgets and levels of investment will differ
between organisations undertaking promotional plans. There are many
approaches that can be applied to the setting and allocation of budgets and to
deciding how much money to spend on promotion. Each of the methods is
generally determined by a combination of external concerns, such as what
competitors do, and internal projections or targets within an organisation, such as
the desired return on investment, sales targets or increases to sales expected as a
result of the plan.
Evaluation and measurement
Measurement remains one of the more complex and difficult stages of the
promotional process, but it is vital in assessing the quality of promotional plans,
their implementation and their effectiveness. Measurement and tracking of
success can assist in avoiding poor decisions, enable adjustments to promotional
strategy, increase efficiency and provide feedback on objectives that have been
achieved. It is important that measurement is linked to the specific objectives of
the plan, and vital to have specific key performance indicators that can be used to
indicate whether a particular initiative has been successful.
Studies have suggested that managers agree on the importance of measurement
but are not satisfied with or confident about either their organisation’s approaches
to it or their capacity to demonstrate a business impact from IMC activities
(Belch & Belch, 2021). Measurement can often be costly – particularly when it
involves collating consumer attitudes – and there can be time limitations that
make measurement difficult. Adding to the complexity of measurement is the
combination of multiple components that are often used as part of the promotions
mix. In this sense, it can be difficult to isolate or separate the specific impact of a
single activity. For example, if a mix of promotions is undertaken, which sales
increase can be attributed to advertising as opposed to publicity or PR
campaigns? Some aspects are easier to measure than others. For example,
tracking measures in digital marketing activities, such as direct email campaigns
through CRM databases, are relatively easy to collate and evaluate. In a non-
digital context, while readership and TV viewing measures may assist in
calculating the reach of a publication or advertising slot, it is more difficult to
measure the direct sales impact of such initiatives.

Considerations for the IMC/promotions mix

A number of considerations are integral to a well-developed promotion or IMC
campaign. In its construction, it is important that the campaign is part of a wider
strategic process. This was discussed at a marketing strategy level in the opening
chapters of this book, and includes capitalising on the assets and resources of an
organisation and consideration of competitors and the environment. When
focusing on the promotional mix, goals and objectives need to be consistent with
the strategic direction and the overall marketing and positioning strategies of the
organisation in order to transmit consistent messages and communications. These
objectives should be focused on specific target market(s) and include specific,
measurable targets.
 Promotional elements can effectively be combined to complement one another,
as some tools or combinations of tools are more suitable than others for
communicating with specific targets. Likewise, some messages are best
transmitted through particular channels. Simultaneous use of components should
be encouraged; but it is vital that the elements are consistent, complementary and,
ideally, synergistic. Integration between the elements of a promotions strategy is
therefore essential, meaning the components used to communicate with target
markets should be consistent in the message they communicate, and brand or
product positioning is aligned with organisational positioning. During
implementation, multiple functions, departments or spokespeople may be used;
for this reason, there is a need for organisational-level integration and cooperation
in order to maintain consistency of message and creative approach.

Summary
Given the importance of the marketing function, the sport marketer not only
needs to be fully conversant with the components of the promotions mix, but also
needs appropriate skills to develop and operationalise a comprehensive
promotional campaign relevant to a given situation and its objectives. To this end,
the establishment of promotion or IMC programmes, while complex and
challenging, is an important, creative and rewarding task (Naraine & Parent,
2017). The carefully planned deployment of advertising, public relations and
publicity, sales promotion and personal selling – as well as direct marketing,
promotional licensing and digital marketing – is crucial to the success of any
sport organisation. Use of a greater range of such tools is now encouraged as part
of a shift away from mass media as the dominant promotional category, and more
emphasis is now placed on direct and interactive marketing tools. The
presentation of a promotions framework to conclude this chapter was structured
around developing communication objectives consistent with broader marketing
plans and the strategic selection of tools that are integrated and can deliver
consistent messages to enable organisational outcomes. As sport marketing
continues to develop, sport marketers should also acknowledge how the
promotions mix is being affected by new developments such as blockchain
(Naraine, 2019b) and artificial intelligence (Naraine & Wanless, 2020).

CASE STUDY
Applying the promotions mix to fan development strategies
Fan development has become a popular term for sport marketers in the last
decade, increasingly used by teams and organisations to articulate, plan and
measure elevations towards more loyal and consistent segments of customers.
The broad aim of fan development is for an organisation to understand its
market size and the behaviours of current consumers, and to develop activities
for users or attendees with varying levels of commitment and consumption. As
well as data and insights, segmentation tools exist that comprise attitudinal or
behaviour variables to help determine groups or segments. Examples may
include elements of the Psychological Continuum Model from Chapter 3 (Funk
& James, 2004) and the Attendance Frequency Escalator (Mullin, 1985).
Conceptually, such frameworks can be applied not just to the sport spectator,
but to varying products and users such as health and fitness participants who
may indulge in their activity of choice from levels of infrequently to daily.
However, fan development in many professional team markets has evolved
towards a much more complex approach than these previous frameworks
represent. For example, the Mullen framework conceptualises groups of non-
aware, aware, indirect or media consumers as well as consumers of varying
levels of consumption. It provides a base for fan development, but is limited
given that modern fan development approaches are about much more than just
encouraging attendance, and seek to incorporate a range of additional
experiences and engagement mechanisms. Additionally, given new
consumption modes, large groups of consumers may be heavily committed but
may do the majority of their consumption through media sources, generating
segments of media-dominant consumers not represented by previous
behavioural frameworks. So, while suggested movement up the escalator
remains conceptually relevant, knowledge of how fans connect and consume
sport team products can be combined with club-specific data to allow much
more specific targeting and strategies.
When applied to professional teams, fan development seeks to widen the
number of consumers who are engaged at each level, requiring the elevating of
involvement levels of existing consumers while at the same time introducing
new consumers to products and services. The fan development approach is in
line with a focus on developing transactional consumers into relationship
customers, and seeks to create greater loyalty, connection and attachment while
contributing to the long-term goals of a team through growth and sustainability.
Fan development for a professional sport organisation may refer to a wide
range of promotional activities, inclusive of those that drive sales and
communication outcomes. They may include, but are not limited to:
 increasing attendances and ticket revenue through sales promotion
sampling and product trial
building awareness and experiences of products and services such as
attendance and membership
focusing on enhancing the customer experience at games
seeking to develop deeper connections through communications and
interactivity via digital or content marketing strategies
introducing the sport to new players, and increasing the fan base by
developing and executing grassroots programmes
direct engagement with communities through activities such as family
days, festivals and team events.

One particular activity, the grassroots programme, is a great way to attract

young fans. Global football (soccer) is not the most popular sport in India given
the country’s infatuation with cricket; but the country is bullish about its
prospects to grow the sport and, more importantly, convert youth participants
into adult fans of India’s soccer products (Indian Super League and I-League)
and the national team. The national sport federation for global football in India,
the All India Football Federation, have begun to invest in the ‘baby leagues’ –
grassroots competitions ranging from under-sixes to under-12s. Additionally,
major European global football clubs like Real Madrid have initiated Indian
youth academies in hopes of finding the next budding star from the
subcontinent. Through these programmes the participants not only learn the
intricacies of the game, but they might also pledge fandom to the brands
associated with their development. So, for Real Madrid, establishing a presence
in India is not just about finding elite talent; it is also about fostering more
fandom outside of Spain. An ancillary benefit of this tactic is that associated
brands like adidas and Emirates, the Middle Eastern airline, both of whom
partner with Real Madrid, are able to amass potential Indian consumers due to
their increased exposure.
Regardless of the approach or dimensions implemented, fan development
activities – inclusive of those linked to promotion – should be carried out as part
of a planned, strategic structure, and should be led by a firm understanding of a
market and segments within it specific to that organisation. Other key aspects of
fan development strategy include a strong brand identity, with accompanying
governing documents and plans to ensure consistency and appropriate
maintenance (Taks et al., 2020), as well as the internal culture to shift to
embrace new tools and activities (Naraine & Parent, 2017).

Questions
 1. Summarise the concept of fan development. What are specific short- and
long-term benefits for organisations of undertaking such strategies?
2. List what information marketers might require: (a) prior to the
development of a fan development strategy; and (b) after its execution in
order to assess the effectiveness of the activities.
3. Choose a professional team with which you are familiar, and develop and
describe a range of segments they may target in fan development activities.
4. Choose a segment or segments, and design a programme of activities that
incorporates as many elements of the promotions mix from this chapter as
possible.
5. What might some SMART objectives of such a campaign be?

References
Belch, G.E., & Belch, M.A. (2021). Advertising and promotion: An
integrated marketing communications perspective (12th edn). McGraw-
Hill/Irwin, New York.
Cravens, D.W., & Piercy, N.F. (2012). Strategic marketing (10th edn).
McGraw-Hill, Columbus, OH.
Direct Marketing Association (2011). The power of direct marketing: ROI,
sales, expenditures, and employment in the US (14th edn). DMA, New York.
Dwyer, B. (2011). The impact of attitudes and fantasy football involvement
on intentions to watch NFL teams on television. International Journal of
Sport Communication, 4, 375–396.
Enberg, J. (2019). Global digital ad spending 2019. eMarketer.
https://www.emarketer.com/content/global-digital-ad-spending-2019.
Evans, J.R., & Berman, B. (1987). Marketing, Macmillan, New York.
Funk, D., & James, J. (2004). The fan attitude network (FAN) model:
Exploring attitude formation and change among sport consumers. Sport
Management Review, 7(1), 1–26.
Green, F. (2019). Winning with data: CRM and analytics for the business of
sports, Routledge, Abingdon, UK.
Irwin, R.L., Sutton, W.A., & McCarthy, L.M. (2008). Sport promotion and
sales management (2nd edn). Human Kinetics, Champaign, IL.
Kotler, P., & Armstrong, G. (2017). Principles of marketing (17th edn).
Pearson, Sydney.
Mullin, B.J. (1985). Characteristics of sport marketing. In G. Lewis & H.
Appenzellar (eds), Successful sport management. Michie, Charlottesville,
VA, 101–123.
Mullin, B.J., Hardy, S., & Sutton, W.A. (2014). Sport marketing (4th edn).
Human Kinetics, Champaign, IL.
Naraine, M.L. (2019a). Follower segments within and across the social
media networks of major professional sport organizations. Sport Marketing
Quarterly, 28(4), 222–233.
Naraine, M.L. (2019b). The blockchain phenomenon: Conceptualizing
decentralized networks and the value proposition to the sport industry.
International Journal of Sport Communication, 12(3), 313–335.
Naraine, M.L., & Parent, M.M. (2016a). ‘Birds of a feather’: An institutional
approach to Canadian national sport organizations’ social-media use.
International Journal of Sport Communication, 9(2), 140–162.
Naraine, M.L., & Parent, M.M. (2016b). Illuminating centralized users in the
social media ego network of two national sport organizations. Journal of
Sport Management, 30(6), 689–701.
Naraine, M.L., & Parent, M.M. (2017). This is how we do it: A qualitative
approach to national sport organizations’ social-media implementation.
International Journal of Sport Communication, 10(2), 196–217.
Naraine, M.L., & Wanless, L. (2020). Going all in on AI: Examining the
value proposition of an integration challenges with on branch of artificial
intelligence in sport management. Sport Innovation Journal, 1(1), 49–61.
Naraine, M.L., O’Reilly, N., Levallet, N., & Wanless, L. (2020). If you build
it, will they log on? Wi-Fi usage and behavior while attending National
Basketball Association games. Sport, Business and Management: An
International Journal, 10(2), 207–226.
Naraine, M.L., Wear, H.T., & Whitburn, D.J. (2019). User engagement from
within the Twitter community of professional sport organizations. Managing
Sport and Leisure, 24(5), 275–293.
Pedersen, P.M., Laucella, P.C., Kian, T.M., & Geurin, A.N. (2021). Strategic
sport communication (3rd edn). Human Kinetics, Champaign, IL.
Ray, M.L. (1982). Advertising and communication management, Prentice
Hall, Englewood Cliffs, NJ.
Stadder, E., & Naraine, M.L. (2020). Place your bets: An exploratory study
of sports-gambling operators’ use of Twitter for relationship marketing.
International Journal of Sport Communication, 13(2), 157–180.
Stoldt, G.C., Dittmore, S.W., Ross, M., & Branvold, S.E. (2021). Sport
public relations (3rd edn). Human Kinetics, Champaign, IL.
Taks, M., Seguin, B., Naraine, M.L., Thompson, A., Parent, M.M., & Hoye,
R. (2020). Brand governance practices in Canadian national sport
organizations: An exploratory study. European Sport Management
Quarterly, 20(1), 10–29.
Veeck, B., & Linn, E. (1962). Veeck – as in wreck: The autobiography of Bill
Veeck. New American Library, New York.
CHAPTER 10

Sport services
Service quality and satisfaction

DOI: 10.4324/9781003270522-13

Chapter objectives
 Chapter 10 introduces service quality and customer satisfaction, two
constructs central to customer loyalty and retention, and therefore important to
organisational success. With sport incorporated as part of the experience
economy, the chapter details why sport organisations should provide high-
quality service to consumers (spectators and participants alike), focusing on the
importance of both core and peripheral aspects of the sport product. It describes
a relational approach to customer management and defines service quality and
satisfaction, providing information on how to model and apply both. The
chapter concludes by looking at the management and measurement of service
quality and satisfaction in organisations.
After studying this chapter, you should be able to:

understand the role of sport as part of the experience economy

define and articulate service quality and customer satisfaction
comprehend the importance of customer retention, and recognise service
quality and customer satisfaction as two key determinants of retention
recognise the importance of relationship marketing and its role in
developing an approach to service quality and satisfaction
understand and recognise the various aspects of the sport service that
customers evaluate
understand the processes by which service quality and customer
satisfaction are derived
understand direct and indirect measurement options and practices for
service quality and customer satisfaction.

Headline story
Satisfaction and sport experience design
One of the original and most innovative sport marketers was American Bill
Veeck, a leader in sports promotion in the 1960s. His view was that the sport
experience for consumers should focus on three areas: the fans, the game and
the periphery areas, with the overarching idea that, to be satisfied, consumers
should be immersed in conversation about the game and the sport experience.
As well as a winning team – something over which marketers have little control
– Veeck argued that the game itself had to be attractively packaged and
aggressively promoted, and that the comfort and satisfaction of the fan should
be paramount.
 As part of this, he offered ‘the money back guarantee’ (Veeck & Linn, 1962),
providing a range of resources and product extensions to add value to the event
experience. Decades later the ‘money back’ concept is still used as a sales
promotion to attract consumers. In the last decade, the Phoenix Suns of the
National Basketball Association (NBA) and the Gold Coast Titans of
Australia’s National Rugby League (NRL) have held ‘Satisfaction Guaranteed
Night’, whereby consumers could acquire a refund on the purchase price of the
game ticket if the experience did not satisfy, or offered a ‘home-win guarantee’,
with fans receiving free entry to the next game if the team lost an early season
game (NBA, 2012; Pierce, 2012).
Strategic direction of Tennis Australia and the Australian Open also aligns
with this approach, where the design and execution of satisfying sport
experiences for the customer or fan is central. Within these organisations, new
techniques and philosophies are influencing the design, measurement and
communication of sport experiences, aiding their delivery of one of the largest
global experiential sports events. The use of human-centred research and design
techniques, technology, data, insights and storytelling, as well as the ‘voice of
the customer’, is shaping future direction and decision making, aiming to help
better understand customer needs and perceptions of what makes a high-quality
and satisfying experience (Cameron, 2019).

Services and the experience economy

As described in the headline story, Bill Veeck’s initial idea was one that
conceptualised the importance of satisfaction in early forms of the sport
entertainment product. Customer satisfaction was an important dimension of
Veeck’s vision, where the creation of product and service encounters within sport
would lead to short- and long-term benefits for organisations. His promotional
mechanism, also evident in examples in the last decade, shows the reliance on
and importance of organisations delivering a satisfying experience. In short, be it
a one-off experience or something offered on an ongoing basis, it is not
economically or operationally feasible for any sport organisation to have large
portions of a crowd or consumer base dissatisfied, either in the short or long term.
Today, most sport marketers recognise the importance of satisfied spectators
and participants, and of providing experiences of high quality. This has developed
as sport organisations have become more professional, and given more
consideration to the service environment and perceptions of customers. With
sport now recognised and embedded as part of the experience economy, sport
experience design components (Funk, 2017) are being used by organisations like
Tennis Australia (in the headline story) to innovate the way sport is delivered.
These processes seek to conceptualise and design sport experiences with the
consumer in mind, and help marketers best deliver experiences that meet
consumers’ needs and expectations.
However, while the ‘co-design’ of experiences in a modern sport marketing
approach is arguably more evident today than previously, what remains equally
important is measurement of services and experiences, and how they assist in
building relationships (An et al., 2020). It is here that understanding perceptions
of service quality and how these perceptions affect value, satisfaction and future
behaviour are critical within an ultra-competitive ‘entertainment environment’
(Clemes et al., 2011). The impact on organisations of losing customers through
product or service ‘churn’ is well documented; as is the expense of attracting new
customers to replace those who leave or switch brands. In countering these
situations, service quality and customer satisfaction play key roles in
understanding experiences and retaining customers, as well as generating other
positive post-purchase behaviours. In turn, this has encouraged acceptance that
relationships with customers and delivery of service quality and customer
satisfaction can provide a competitive advantage for organisations.
We can define sport as having emerged from product and services economies
towards an experience economy. The critical role of experiences – through either
spectating or participating – has become increasingly complex, and the market for
many products or services has grown more competitive. Substitutes such as other
forms of entertainment, cultural or arts offerings can deliver fulfilment for needs
like excitement, escape and social interaction; therefore it is as important as ever
for sporting organisations to develop a firm understanding of what generates
quality perceptions and satisfies their customers. More satisfied consumers mean
higher levels of renewal or continuing sales, but can also channel other benefits,
including fewer complaints, more positive word-of-mouth promotion, the buying
of additional products, less attention paid to competitors, reduced transaction
costs and lower marketing expenses (McDonald et al., 2013, 2018). The wider
contribution of satisfaction and satisfied consumers can therefore be presented in
terms of profitability, marketability and sustainability for a range of sporting
organisations.

Defining sport services

A sport product includes a bundle, or combination, of qualities, processes and
capabilities that can lead to satisfaction (Mullin et al., 2007). While the value and
benefit from sport products contain both tangible and intangible elements, the
offering can be classified as a sport service if the core benefit is more intangible
than tangible (Berry & Parasuraman, 1991). Given this definition, professional
and amateur sports teams, and health and fitness centres and facilities are among
examples of sport-related services.
The sport servuction model in Chapter 7 demonstrates a range of factors that
contribute to satisfying experiences for sport consumers. These can include the
inanimate environment, contact personnel and other customers. The model also
includes ‘invisible’ aspects such as the organisation, its processes and its systems,
such as marketing departments. These broad aspects that drive satisfaction (for
example, the facility, organisational processes, communications and other
consumers) are much the same for a vast array of sport experiences, ranging from
spectators at a professional football game to participants in a group fitness class
or social netball tournament, or even fantasy sports. In each case, a journey can
be constructed to conceptualise and visualise the various touchpoints, decisions
and experiences a customer may have in each setting (George & Wakefield, 2018;
Yuksel et al., 2021).
As well as being multi-dimensional in the factors that influence fulfilment and
satisfaction, many forms of sport consumption are complex combinations of
aesthetic, emotional, identification and hedonic benefits (McDonald et al., 2013).
Therefore, many sport services and consumption activities are high in ‘experience
qualities’ (Zeithaml, 1991), with consumers becoming heavily involved in their
consumption as a result. Such cases present additional complexity for
organisations, which need to be aware of this multifaceted consumption and seek
to manage the ‘experience’ rather than just the event.
Within the broad dimensions of the sport ‘experience’ are core products (that
is, the game or sport itself) and the wider product extensions that make up the
overall sport service experience. Marketing theory suggests that customer
satisfaction and service quality result from both dimensions, with overall
evaluations strongly influenced by the extensions or peripheral components. Until
recently, little was known about dimensions in sport that most strongly influenced
customer evaluations; but research using season ticket-holders indicates that
product extensions contribute strongly to customer satisfaction (McDonald et al.,
2013, 2018) and that aspects of services play a positive role in the building of
loyalty and future intentions towards the organisation. The dominant role played
by product extensions in a spectator’s satisfaction is good news for sporting
organisations as they are often the components that fall under the control of sport
marketers.

A relational approach to customer management

Similar to all industries, sporting organisations have broadened their focus from
internal product development and performance to include greater attention on
external stakeholders, including attitudes towards the products consumed.
Functions of this altered approach are a long-term focus and a more involved
view of the customer, which can be framed within a relationship marketing
approach. Relationship marketing refers to efforts within marketing where the
buyer and seller attempt to provide a more collectively satisfying exchange. From
the organisational side, it seeks to go beyond single transactions with customers
(Grönroos, 1992), and attempts to create richer relationships with greater
personalisation, interaction and eventual loyalty. Principles of relationship
management can assist in driving better understanding of consumers, help in the
development of products and lead to consumer loyalty and related behaviours in
the short and long term. Specific to this chapter, assessments of service quality
have been shown to improve customers’ perceived relationships with the sport
organisations they support (Lee et al., 2020).
Relationship marketing is relevant where alternatives exist for customers, and
where purchase may be periodic and continuing. One example is subscription
markets, which are becoming more common in sport and leisure settings (and
other marketing domains). These play a role in developing purchase relationships,
enabling attachment and involvement with a brand, and can enhance switching
barriers through contracts or fixed purchase periods. Utilities, phone and internet
provision are examples of services that are often consumed as subscriptions; and
it has become more common to find subscription products aligned to both
spectating and participating in sport – in line with the tenets of relationship
marketing.
The offering of a season ticket package or sports club membership is a
common subscription practice for professional sport teams, with both domestic
and global growth in such products. For example, 1 in 25 Australians was a
member of one of the 18 Australian Football League (AFL) clubs in the 2019
season (Karg et al., 2019), while football clubs like Germany’s Bayern Munich
have close to 300,000 members globally (Statistica, 2020). In the case of ticket
packages for those who attend games, these can vary in price and offer different
levels of game access, seat location and benefits like club communications and
merchandise.
Such products are becoming more common in sport and are moving beyond
teams, with ticket packages or memberships available for events such as tennis or
golf tournaments and professional cycling. For members who join but live
somewhere different from their chosen city club or team base, such products offer
tangible and intangible benefits that allow fans to build a connection with a sports
team or body they support. As such, even without the core product offering
(attendance at the sport event), memberships are still used to drive additional
loyalty and commitment despite inconsistent physical examples of consumption.
Membership as a form of subscription is replicated by various other arts and
leisure organisations (e.g., theatre companies, art galleries) and by local sporting
clubs where consumers may participate by playing for a team. Likewise, health,
sport and fitness clubs offer memberships for users who share some of the same
characteristics, and are often a major generator of revenue for these organisations
(Lam et al., 2005; Tsitskari & Tsakiraki, 2013).
With the exception of one-off events, there appear to be few sport or wider
leisure services that would not benefit from a relationship marketing approach,
whether they distinctly offer subscription products or not. So how do service
quality and satisfaction play a role in building customer relationships? Traditional
customer relationship management (CRM) theory proposes that the management
and monitoring of customer expectations, followed by delivering service quality
that successfully meets or exceeds such needs, are vital to long-term success
(Grönroos, 1990). ‘The most widely accepted framework is that customer
perceptions of service quality (performance) impact customer satisfaction which
impacts upon future behaviour (e.g. loyalty, future purchase intention, word of
mouth)’ (McDonald et al., 2013, p. 43).
Leveraging this theoretical understanding, the practical evolution of service
and experience design in a hyper-competitive setting is seeking to improve
service quality and satisfaction and enhance relationships with customers.
Creating satisfying and high-quality experiences is important, alongside the adage
that it is cheaper or easier for a business to keep existing customers than find new
ones. While business growth ultimately can be achieved through either method, it
seems logical that marketers should attempt to balance ‘offensive marketing’ that
targets new customers and increases purchase frequency with ‘defensive
marketing’ concentrated on reducing turnover, managing dissatisfaction and
increasing loyalty through increasing both customer satisfaction and the
switching barriers relevant to consumption.

SPORTVIEW 10.1
Technology and sport experiences: changing delivery and
evaluation
Many of the ideas and frameworks presented in this chapter are based on or
adapted from long-established ideas around the value that services can create
and deliver. However, the modern sport experience, as part of an experience
economy, is increasingly impacted by technological trends creating new ways to
influence the design and improvement of sport consumer experiences.
Additionally, in the sport setting, the days when experiences were solely
based on what transpired on the field have passed, with a central need now to
position and consider the customer when delivering experiences. As well as
changing the ways consumers experience sport, new technologies and
augmented experiences create new ways to monitor experiences, gather
feedback and execute improvements to consumer experiences – albeit within the
established tenets and frameworks of service quality and satisfaction.
The Sacramento Kings of the NBA are one example of the worlds of sport,
technology and entertainment mixing. The Kings, who play in a new stadium –
Golden 1 Center, in a revitalised downtown area of the Californian city – have a
strong commitment to technology as part of their facility and fan experience.
Since their move to the new venue in 2016, they have been named the ‘most
innovative company in sports’ by US business magazine Fast Company and
‘Most Tech-Savvy Team’ by media company SportTechie.
Many of these innovations focus on the at-venue experience, using
infrastructure in the stadium to improve the experience of customers. For
example, fans are provided with a ‘hyper-personalised arena experience’ where
additional on-demand information and advanced statistics are delivered via the
Sacramento Kings + Golden 1 Center digital app (Hernández, 2021).
Additionally, the Royalty Pass technology allows fans to purchase food and
drinks using a digital wallet, amplifying fan engagement and delivering real-
time personalised benefits through discounts and promotions (NBA, 2020).
Finally, when fans are not in the stadium, the app offers distinct game-day
benefits, including access videos, games and promotions, and opportunities to
interact with other fans and game-day experiences.
In line with current trends, the Kings demonstrate the ability of digital
technology to unlock opportunities for growth and the potential for increased
volumes of ‘innovative and customised experiences’ (Georgio et al., 2018).
Such examples of technology are changing the ways fans access tickets, transact
with concessions in the arena and provide feedback on their experiences.
Therefore, to understand and measure service delivery, organisations need to
consistently be aware of the customer journey and adopt tools to measure
service quality as well as its impact on fan experiences and satisfaction.
Defining and differentiating service quality and customer
satisfaction
As both service quality and customer satisfaction are attitudes or types of
consumer evaluation, they are often referred to interchangeably. However
differentiation between the two is important: customer satisfaction is most easily
defined as satisfaction being experience-dependent, while service quality is not
experience-driven but rather led and formed by consumer perceptions. Distinctly,
perceptions of service quality can result without actual experience of the product.
As an example, individuals must experience a sport product to be either satisfied
or dissatisfied with it; but no experience is necessary to develop perceptions of
quality. Therefore, satisfaction can be posited as a higher-order construct,
depending on the perceptions of service quality, and specifically on consumer
expectations prior to the consumption experience.
Service quality is defined in terms of a judgement about how excellent a
service or service component is (Lovelock et al., 2001; Parasuraman et al., 1988).
For example, the more closely the spectator’s or participant’s perception
approximates excellence, the higher their evaluation of service quality will be.
Parasuraman et al. (1988, p. 13) suggest that service quality is an ‘abstract and
elusive construct because of three features unique to services: intangibility,
heterogeneity, and inseparability of production and consumption’. Adding to their
complexity, services are ‘dominated by experience qualities, attributes that can be
meaningfully evaluated only after purchase and during production-consumption’
(Berry & Parasuraman 1991, p. 7). Therefore, customers do not evaluate service
quality purely on the outcome, but also consider the process of the service that is
delivered (Zeithaml et al., 1990).
Satisfaction is an overall evaluation occurring post-consumption, as opposed
to service quality, which is a multi-dimensional appraisal of aspects of the
product offering (Iacobucci et al., 1995). Within this, research demonstrates that
sport customers evaluate a plethora of service components, with customers’
summary or overall satisfaction and perception of quality being a function of
many different, ‘smaller’ evaluations. Satisfaction is said to occur as inevitably as
purchase and consumption (Oliver, 2010), and can be viewed as an end state of
the overall consumption experience. In line with earlier distinctions, service
quality can then be presented as an antecedent to satisfaction, with satisfaction
moderating the relationship between service quality and future consumer
intentions.

Service quality
Despite a strong history of service quality research, there remains limited
agreement on its conceptualisation (Cronin & Taylor, 1992; Rust & Oliver, 1994),
such that ‘there is no universal, parsimonious, or all-encompassing definition or
model of quality’ (Reeves & Bednar, 1994, p. 436). Most commonly, service
quality is viewed as the customer’s perceptions of excellence defined by
impressions of service levels provided (Berry et al., 1988).
The concept of quality in marketing was first considered in the manufacturing
sector, where quality originally looked solely at the end-product (that is, the
finished good). Later, the focus would transition to broader production processes
and then further to provide a starting point for understanding service quality.
Admittedly, the concepts were not immediately transferable to service
organisations, given differences such as inseparable production and consumption
and variation in service delivered across consumption periods.
Adding to this complexity, sport organisations do not control the core sport
product (on-field performance), which has resulted in marketers focusing more on
delivering product extensions relevant to the sport product. In doing so, much
more can be done to shape the experience of a consumer. For example, while a
marketer of professional sports cannot guarantee that a particular team will win or
lose, they can develop processes and achieve high perceived quality ratings for
extensions such as entertainment, entry to the stadium or facility, ticketing,
service and merchandise. Delivering these elements seeks in some ways to
provide a ‘barrier’ to on-field performances and a high-quality experience
regardless of what happens on the field.

Modelling service quality

Service quality is a matter of perception (that is, the individual customer’s
perception), and two people who experience the same service may thus have very
different perceptions of its quality. This is particularly so in the context of sport,
where two customers – whether player or spectator – are barracking or playing
for opposing teams. Further, an individual’s perception of service quality may
vary from one experience to the next, due to a range of factors that often are
beyond the organisation’s control, such as the customer’s mood, loyalty, past
experiences or who they are sharing the experience with.
For sport marketers to increase perceived quality of their services, a vital
starting point is understanding how service quality is constructed by a consumer.
Gaps within the service quality framework (Parasuraman et al., 1985) assist with
articulating how service quality develops for consumers (as shown in Figure
10.1). Gaps exist between the expectations and perceptions of customers,
management and employees. The overarching service gap – between what
customers expect and what they perceive they actually have – is a function of four
other gaps described below.

Figure 10.1 Conceptual model of service quality Source: Hoffman &

Bateson (2017). Reprinted with permission of South-Western College
Publishing, a division of Cengage.

The knowledge gap exists between customer expectations of service and

management perceptions of those expectations. It occurs when what
management believes customers expect is different from what customers
actually expect (for example, a manager of a community sports centre might
believe that players expect hour-long games of netball when they would
instead prefer to play shorter but more numerous games).
The standards gap exists between the management’s perceptions of
customer expectations and the organisation’s service specifications. This
occurs where there are insufficient resources to deliver what customers
expect, or when management is apathetic to providing expected service
levels (for example, a marketing manager of a professional basketball team
may be aware that season ticket-holders expect more interaction with
players, but may not see this as a priority or regard it as too difficult given
the players’ numerous other commitments).
 The delivery gap exists between an organisation’s service quality
specifications and actual service delivery. It generally arises as a result of a
lack of willingness or ability of the service personnel (for example, even if
an aquatic centre’s service charter may stipulate that service staff should be
friendly and helpful to customers at all times, its staff may either be
unwilling to fulfil this commitment or simply not have the service or
interpersonal skills to do so).
The communications gap exists between perceptions of actual service
delivery and external communications about the service. It occurs where an
organisation over-promises in its advertising and other communications (for
example, a professional sports club’s advertisements promising its
supporters a win at the next home game).

It is important that marketers are familiar with these potential gaps and how they
contribute to spectators and participants getting what they expect. Expectations,
whether driven by communication, service charters or past experiences, will
impact consumers’ evaluations of service quality. Sport marketers will be able to
improve the quality of services by identifying and then closing each of the
knowledge, standards, delivery and communication gaps. More on understanding
and measuring consumers’ attitudes and these gaps is provided in the following
section.

Measuring service quality: SERVQUAL and applications to sport

The original tool to measure service quality is known as SERVQUAL, which has
been adapted to a number of different industries and contexts since its initial
development. SERVQUAL is an instrument incorporating five service quality
dimensions, and is the most well-known and used tool for assessing service
quality across a range of industries (Parasuraman et al., 1988). The five
components include:

tangibles – physical facilities, equipment and appearance of personnel

reliability – the ability to perform the promised service dependably and
accurately
responsiveness – willingness to help customers and provide prompt services
assurance – knowledge and courtesy of employees, and their ability to
inspire trust and confidence
empathy – caring, individualised attention that the firm provides to its
customers.
It was acknowledged by the original authors that, given the breadth and variance
of service experiences across industries, SERVQUAL should be modified and
applied to new contexts. In line with this, a significant number of sport-based
studies have developed frameworks of service quality in sport through the
adoption and modification of SERVQUAL.
For example, fitness centres and public recreation facilities have provided a
basis for the application of SERVQUAL dimensions (Chelladurai and Chang,
2000). The Scale of Attributes of Fitness Services (SAFS), Quality Excellence of
Sports Centers (QUESC) and the Service Quality Assessment Scale (SQAS) are
among those measures that have identified dimensions of service quality in sport
and fitness centres (Chelladurai, 1987; Kim & Kim, 1995; Lam et al., 2005).
Aspects such as atmosphere, staff attitude, reliability, information, programming,
price, convenience and facilities were all found to be important considerations.
Recent work has extended the study of service quality with an interest in the
impact of variables on perceived value and intentions (Howat & Assaker, 2016;
Olya et al., 2021) and usage of different types of facilities (Polyakova &
Ramchandani, 2020).
Sport participation has also been a focus of research that has replicated core
dimensions of the original SERVQUAL (Howat et al., 1996). The Service Quality
of Sports Participants (SSQPS) scale looked at the range of programmes, service
interactions and results (physical and social change), as well as the delivery
environment (Ko & Pastore, 2001). Scales have also been adapted specifically to
outdoor activities or schools programmes. In the case of the latter, elements such
as cost, staff skill, planning or organisational elements, social relations and
communication were among those found to be important assessable areas. A
focus on differences across types of participants has been an emerging theme of
recent work (e.g., An et al., 2020).
Spectators have likewise been a setting, with perceived quality elements found
to include access, parking, aesthetics and cleanliness of facilities, quality of
scoreboard, comfort, cost, concessions, service, crowd control, convenience and
anti-smoking policy (Kelley & Turley, 2001; Wakefield & Sloan, 1995). More
specifically, McDonald et al. (1995) developed TEAMQUAL by applying
SERVQUAL dimensions focusing on service encounters in professional team
sport. Similarly, Theodorakis et al. (2001) and other authors utilised the
SPORTSERV tool to measure spectator service quality perceptions in
professional sports. The instrument included measurement of access (parking),
reliability (delivering on promises), responsiveness (staff service), tangibles
(stadium), and security and safety. This scale was further developed using the five
‘process’ dimensions from the original SPORTSERV, combined with two
‘outcome-related’ dimensions of team performance (namely, players performed
well) and game quality (competitiveness of the game) (Theodorakis et al., 2013).
Studies on ‘new’ events (e.g., Formula One) have focused on extending
understanding of event and service quality on value and its links to consumer
engagement (Jones et al., 2019).
Overall, SERVQUAL, and its adaptations, has provided a useful base for
application to various areas of sport services, including fitness centres,
participation programmes and spectating contexts. In many cases these have
largely been derived from the original SERVQUAL components, with unique
applications to each service quality context. Their application has sought to
deliver meaningful insight for managers around consumer perceptions of quality,
weighted against expectations of what the service was expected to deliver. The
vast body of work (over 120 studies) on the differentiated effects of service
quality dimensions on sport consumer outcomes was summarised by Biscaia et al.
(2021). The results indicated that the dimensions of quality (i.e., functional, core
or aesthetic) had mixed influences on outcomes, including value and behavioural
intentions.

Satisfaction
As noted earlier, there are important distinctions between service quality and
satisfaction, including ongoing attention regarding how customer satisfaction and
service quality are linked to customer service and wider aspects of relationship
and service marketing. Service quality can be viewed as an antecedent of
customer satisfaction in that it influences but does not fully predict satisfaction
levels (Theodorakis et al., 2013; McDonald et al., 2014). Further, satisfaction was
developed as requiring experience of the product, as opposed to service quality
being perception-led.
As an overall measure, satisfaction represents a desirable end-state of
consumption, and can facilitate a sense of achievement and reaffirmation of the
decision-making competence of a consumer. Satisfaction occurs as an inevitable
result of purchasing or consuming a good or service, with variants of satisfaction
including ‘interim’ and overall ‘end-state’ forms – that is, attitudes can be
assessed both during and at the conclusion of a consumption experience (Oliver,
2010). Considering sport, and a complete consumption experience, dimensions or
‘variants’ may include satisfaction with events or elements during consumption
(waiting in line, seat comfort, noise and surrounds), satisfaction with the final
outcomes (enjoyment, entertainment, emotions) and satisfaction with the level of
satisfaction received (inadequate, adequate, excessive). As such, the level of
satisfaction can be viewed either in terms of singular event(s) leading to an
outcome or as a collective impression (Oliver, 2010).
Satisfaction should be viewed as an important measure, considering that
ongoing customer interactions are a prerequisite of an organisation’s success.
Satisfaction has a viable link to primary variables like profitability and market
share (Anderson & Mittal, 2000; Kotler, 2000) and secondary impacts like word
of mouth and fewer complaints. While it is known that attitudes correlate with
repurchase in the case of satisfied customers, dissatisfaction can result in negative
word of mouth, complaining or other dysfunctional behaviours. Therefore,
understanding what drives satisfaction for a range of products or services is
important.

Role of expectations and ‘disconfirmation’ in satisfaction

In understanding how satisfaction is determined, the ‘disconfirmation of
expectations’ paradigm (Oliver, 2010) remains the dominant theoretical
framework for consideration in sport settings (McDonald et al., 2013). Judgement
of fulfilment under Oliver’s model requires an outcome and a comparison point,
and denotes that customers: (1) form certain expectations of product performance;
(2) observe or experience the performance; and (3) form perceptions of that
performance. Note that where service quality considers expectations and
perceptions, Oliver’s model includes experience as a distinct part of the process.
These experience-dependent perceptions of performance will be compared with
the customers’ originally held expectations (Churchill & Surprenant, 1982;
Oliver, 2010). Together with customer satisfaction, these three determinants
(expectations, perceived performance and disconfirmation) form the
‘disconfirmation of expectations model’ (DEM) depicted in Figure 10.2.
 Figure 10.2 Disconfirmation of expectations model (DEM) of customer
satisfaction

From a theoretical view, the DEM and subsequent interactions and rationalisation
of performance versus expectation can produce three outcomes: negative
disconfirmation (performance falls short of expectations); zero disconfirmation
(or confirmation of what was expected); or positive disconfirmation (which
results in a satisfied consumer). Therefore, expectations can be met, they can be
exceeded (resulting in consumer delight) or the experience can fall short of
expectations. Understanding the expectations of consumers emerges as a critical
component for managers, in particular when considering growth and servicing of
new consumers.

SPORTVIEW 10.2
Managing expectations of new consumers
The ability to retain consumers and convert them into loyal, long-term
supporters has been shown to be a key to business success. However, figures
from major Australian and US professional sports teams suggest that high
numbers of first-year season ticket-holders will ‘churn’, or not renew, their
ticket (Karg et al., 2021). Such behaviour – particularly when teams have
limited numbers of consumers from which to draw – can create significant
hurdles to growing season ticket-holder bases. Even in high-demand cases
where waiting lists exist, season ticket-holders have been shown to churn at
 high rates, even if customers have spent many years waiting for the chance to
acquire tickets. As in many industries, the non-renewal rate slows significantly
once a season ticket-holder has been a constant customer for a few years,
meaning positive first-year experiences are vital for retaining consumers and for
growing season ticket-holder bases over the long term. For many of this first-
year group, a core reason for churn is the lack of satisfaction with the purchase
decision, or a lack of perceived value – which in many cases is driven by
unrealistic expectations of what a season ticket will offer.
Research has shown that consumers can have very different expectations
from what may actually eventuate post-purchase. For example, season ticket-
holders may think that their purchase will allow them automatic allocation of
premium seating, access to free tickets for family and friends, the ability to meet
players or attend functions, devoted account managers on hand for handling
enquiries, or free merchandise. While many of these may not be unrealistic
expectations, or they could be met for very small season ticket-holder bases,
delivering these benefits for season ticket-holder bases that exceed 40,000 or
50,000 people can be very difficult. Additionally, it is common for first-time
season ticket-holders to lack accurate knowledge about aspects such as the cost
of parking and concessions, and ticket about resale or allocation policies that
can add significantly to the financial outlay of owning a season ticket.
Therefore, the first-year experience will be one that, even if delivered
impeccably by the team or club, will have aspects that do not meet the first-
timer’s expectations.
Professional teams across a range of sports undertake sophisticated research
to better understand season ticket-holder expectations. One outcome of this
process has been specific induction and communication programmes to help
integrate first-time season ticket-holders into the consumer base. Such
programmes provide first-year members with: a specific contact person within
the organisation; better information on activities and matchday access; functions
specifically for first-year members to meet and socialise; and specific actions
where the club contacts them during the season to check on their progress and
experiences to date. All these activities represent basic service actions – relevant
to professional sport teams as well as other subscription organisations – to better
integrate and manage expectations so consumers will have more positive
experiences and perceptions when the next purchase decision arrives.

Measuring satisfaction in sport services

Specific to sport, there has been an increasing amount of work dedicated to
satisfaction with services, particularly spectator services. Further building on the
DEM – and adding to the complexity of measuring satisfaction – it has been
suggested that a range of factors can moderate the satisfaction relationship.
Specifically, Van Leeuwen et al. (2002) propose that unique aspects of sport –
such as club identification and the win/lose phenomenon – should be considered
given that those who are more committed, and those fans whose teams experience
on-field success, could logically be more satisfied. Yoshida and James (2010)
distinguished between game satisfaction and service satisfaction, suggesting that
both core service dimensions (that is, the game) and peripheral service
dimensions or ‘product extensions’ such as parking, concessions and half-time
entertainment (Mullin et al., 2007) are valuable additions to any consideration of
what drives overall satisfaction.
Recent work has also considered the relational consumer, such as the season
ticket-holder. Here, the assessment seeks to move beyond the single consumption
experience towards understanding and building satisfying relationships with
consumers though a range of product extensions delivered in addition to the
matchday component. Using frameworks from sport (Beccarini & Ferrand, 2006;
Van Leeuwen et al., 2002) and other industries such as the arts (Garbarino &
Johnson, 1999), McDonald & Shaw (2005) and later McDonald et al. (2013)
developed a comprehensive set of service-based club-performance measures that
can be demonstrated to affect seasonal ticket-holders’ satisfaction within a
sporting context. The framework (presented in the case study at the end of the
chapter) tested the importance of, and level of delivery for, a number of
components relating to the season ticket-holder product, including ticketing,
service, communication, administration, personal involvement and home ground.
As well as satisfaction with each element, overall levels of satisfaction with
the holistic season ticket-holder are measured and assessed, with the tool shown
to be robust enough to handle significant changes in variables such as on-field
performance. The framework has been adopted in other research, including
looking at the impact of specific events such as coach sackings on satisfaction
(Karg et al., 2015), how experiences differ across gender (McDonald et al., 2018)
and how experiences can assist with the creation of relationship quality (Lee et
al., 2020).

Managing service quality and satisfaction in organisations

Developing high levels of customer satisfaction and retention requires
management of three distinct processes: ‘designing the service product, designing
the service environment, and delivering the service’ (Rust & Oliver, 1994, p. 3).
It should be clear, given the models of service quality and satisfaction presented
above, that a sport customer’s expectations play an important role in their
evaluations of quality and satisfaction. The management of expectations
represents a key area that organisations need to understand – particularly given
that disconfirmation of expectation processes strongly influence evaluations of
quality and satisfaction. Multiple types of expectation are considered by
consumers, with each impacting service quality and customer satisfaction; and as
such it is important for sport marketers to understand the influence they have over
such expectations. So where do expectations come from, and what can
organisations do to influence them?
Consumers’ expectations are determined by myriad characteristics.
Communication or information provided by the sport organisation is a common
method, meaning the communication used in various promotions may shape the
setting of expectations as part of the consumption process. Promising a ‘market-
leading sport experience’, ‘world-class sightlines within a stadium’ or ‘24-hour
delivery of a sport product’ may be a feature of advertising that attracts
consumers; but organisations must also realise how this influences the
expectations customers develop. Similar to promotions, other marketing ‘Ps’ can
guide how consumers may set expectations for a service. For example, the place
or physical environment (inclusive of the facility) or the price attributed to a
service will play a role in shaping expectations of how it will perform and what
value it will deliver. Additionally, there are other external or environmental inputs
that will influence expectations. These may include comparisons consumers make
to similar or substitutable products of which they are aware or that they have
consumed, or the influence of family and friends on their experiences or
perceptions of the service.
Given the central role of expectations to service quality and customer
satisfaction, and the influence that sporting organisations can exert on their
expectations, it is essential that sport marketers learn to manage what customers
expect from them. Sport marketers must not promise more than their
organisations can realistically deliver. Management and reaffirmation of
expectations can be undertaken through programmes or communication, with the
creation of induction programmes and communications one example of such
action (see Sportview 10.2).
As well as assisting with the development of realistic expectations for services,
the measurement of satisfaction presents as a complex issue for organisations.
Given that satisfaction can be assessed at various levels, it is reasonable to use
satisfaction of specific areas of a product or service, as well as the interpretation
of overall measures. There are multiple ways in which organisations can gather
and interpret information to understand satisfaction levels, including indirect and
direct measurement of consumer attitudes.
Indirect methods of customer satisfaction measurement can include tracking
and monitoring customer complaints, sales records, profits and rates of customer
retention. Importantly though, many of these are not solely dependent on
consumers’ satisfaction. Increasingly, there are other information sources –
ranging from suggestion boxes and feedback mechanisms in apps or ticketing
processes, to monitoring social media and online forums – that provide huge
volumes of consumer feedback that can help inform both the level and cause of
satisfaction.
Likewise, direct measures of customer satisfaction can be undertaken using
research. This may include qualitative approaches such as interviews or focus
groups, or rely on quantitative methods such as surveys or questionnaires. In the
latter, respondents indicate a level of satisfaction based on a multiple point scale.
As well as satisfaction levels, it is important to understand why consumers are
satisfied or dissatisfied. This can be done using statistical modelling to determine
the strongest drivers of overall satisfaction, but can also be achieved by asking
participants to identify exactly what was satisfying or dissatisfying about their
experience. Such a process can assist in capturing ideas about what aspects of the
service were poorly delivered or can assist with developing improvements. Given
the high level of identification associated with sport services and products,
consumers are often very forthcoming in providing customer satisfaction
researchers with this sort of valuable information. However, while large-scale
surveys and data collection provide reliable information to develop satisfaction
data, the interpretation of results can be more complex.
A considerable amount of data suggests that the majority of respondents report
being ‘satisfied’ (Peterson & Wilson, 1992); but, given that customer satisfaction
is measured by degrees ranging from ‘dissatisfied’ through to ‘very satisfied’, and
is a function of prior expectations, there are no firm metrics or levels of
satisfaction that are ‘acceptable’. Indeed, such levels may differ from year to year,
from consumer to consumer and across products and industries, so interpretation
of data can be difficult. For example, a season ticket-holder base or fitness centre
membership segment may provide an overall satisfaction rating of 8 out of 10, or
75 per cent may indicate they are highly satisfied, with interpretation of such data
vastly aided by wider collation and interpretation of sources. As such, a need for
longitudinal or comparative data by which to make comparisons can add value.
Here, if a sport facility scores higher on satisfaction or quality scores the year
following investments made to improve the facility, the change in data or scores
provides a more direct comparison and interpretation of those improvements.
Likewise, benchmarking data such as industry averages can provide valuable
information for teams or facilities that offer comparable services.
Measurement can also be made more difficult given the ‘halo’ effect that
influences attitudes towards aspects such as service quality and satisfaction. A
halo effect is defined as ‘a marked tendency to think of a person (or event) in
general as rather good or rather inferior and colour the judgements of the specific
performance dimensions by this general feeling’ (Thorndike, 1920, p. 25).
Relevant to sport, there is evidence that high team identification of spectators or
fans, or the impact and feelings provided by winning teams, can greatly influence
the level of satisfaction experienced by season ticket-holders. Here, the
involvement or ‘winning feeling’ presents as a halo factor that can influence
(positively or negatively) other specific performance dimensions of the service. In
line with a halo effect, these impacts are seen to influence more strongly those
elements perceived as closest to the ‘core product’ (that is, perceptions of on-field
performance, involvement and team administration), as opposed to other product
extensions such as communications or home ground (Karg et al., 2008).
In the context of spectator sport, Madrigal (1995) found that the affective
components of basking in reflected glory (BIRGing), or an individual’s
inclination to ‘share the glory of a successful other with whom they are in some
way associated’ (Cialdini et al., 1976, p. 366) – together with enjoyment,
disconfirmation of expectations, team identification and quality of opponent –
contributed to customer satisfaction with university basketball games.
Additionally, Lapidus and Schilbrowsky (1996) conclude that the quality and
results of basketball games affects the perceived quality and satisfaction of
peripheral services under the pretence of the halo effect. As the title of their
article suggests, the hot dogs did taste better when the home team won! That is,
the overall service was perceived as better when the team or on-court product was
satisfying. Such influences have implications for collecting and interpreting
satisfaction data, as well as its measurement.
Outside of quantitative measures to assess customer satisfaction, marketers are
advised to seek additional qualitative information, including why consumers
evaluate the service in the way they do, and how the service might be improved.
Those cases where consumers are not satisfied present opportunities for remedies
and action. The ability to identify and communicate back to consumers the
changes that are made can also communicate positive word-of-mouth or similar
opportunities where the organisation is showing a proactive approach to
consumers and marketing. Complaint-inducement can be derived from survey,
phone, email and even social media mechanisms. Handling complaints well has
positive implications for sport organisations, as well as the satisfaction of their
customers within the realm of relationship marketing.
Finally, while certainly proven, the strength of the relationship between
satisfaction and positive behaviours or loyalty can be overestimated. For example,
an over-reliance on satisfaction while not being aware of other reasons for
purchase or churn away from a product can impact the projections and actions
that managers make. Indeed, many consumers who perceive high quality, or who
are highly satisfied, may still churn given the lack of availability of a service, or
changes to personal circumstances such as financial or lifestyle changes. As such,
while high levels of service quality and satisfaction are certainly desirable, it is
important for marketers to constantly be aware of how products are perceived and
positioned for consumers.

Summary
This chapter has explored service quality and customer satisfaction as outcomes
of sport experiences. The importance of developing a relational approach to
service management framed the chapter, with the provision of high-quality and
satisfying sport services linked to organisational success through a number of
positive consequences for the sport organisation. Customer satisfaction and
service quality were described as distinct types of evaluation. It was noted that
these evaluations can be of the overall spectator or participant service, as well as
of individual aspects or components. A number of factors need to be managed
successfully in order for customers to enjoy the sport experience, and thus
evaluate it positively. Due to the uncontrollability of the core product, sport
marketers must realise that they have minimal influence over perceptions of
quality and feelings of satisfaction arising from the game or sport experience
itself. As such, sport organisations must focus on ensuring that the product
extensions are of the highest possible standard.
Discussion of management and measurement of service quality and
satisfaction closed the chapter. Sport marketers must understand those factors that
influence the expectations held by spectators and participants, and learn to
manage them successfully. Through identifying, understanding and managing
expectations, sport organisations will be better placed to provide high-quality and
thus satisfying sport services, which in turn may provide them with a competitive
advantage and related benefits. When measuring customer satisfaction and
service quality, proactive actions and responses can provide opportunities to turn
around poor levels or cases of customer satisfaction and service quality, leading
to improved and sustainable business outcomes.
CASE STUDY
Member satisfaction in Australian professional sport clubs
Adam Karg, Heath McDonald and Tom Benetti-Baker
In 2018 and 2019, over 1 million memberships (or season tickets) for
Australian Football League (AFL) clubs were sold across the country. While
member growth in the AFL is one example where teams have increased their
numbers, likewise National Rugby League, A-League (soccer), Big Bash
League (cricket), Super Netball and National Basketball League clubs in
Australian are among those that have increased their focus on acquiring and
retaining members.
When achieved, rapid growth in member numbers raises a range of problems
for clubs, as it would for any organisation. On the practical front, managing a
database of, for example, 25,000 members is far more complex and time-
consuming than running one for 5000. Significant investment in infrastructure,
technology and staff is needed. Additionally, the ‘member experience’ changes
as teams increase member numbers: where once it may have been possible for
fans to mingle freely with players after games, with tens of thousands of
members such casual arrangements are no longer possible. Often the
membership departments of professional teams could typically be staffed by
only one manager and several part-time or volunteer staff; but they now require
larger teams with specific roles and functions for staff.
In the Australian setting, for nearly two decades sport clubs have also been
systematically researching member perceptions of service quality and
satisfaction with membership products. This member satisfaction (MEMSAT)
research, conducted annually by teams in more than six major sport leagues in
the country, utilises surveys to identify the level of member satisfaction and
provide guidance to the clubs on how satisfaction levels can be managed.
Across the leagues, well over 150,000 responses are received each year, with
many teams incorporating progressive surveys or multiple rounds of data
collection each year.
Table 10.1 shows the overall results of a combined sample of sport teams
from four leagues, highlighting member satisfaction with different aspects of
sport membership service in 2019. Two major components of member
satisfaction are measured: the perceived performance of services and the
importance of those services to overall satisfaction. Satisfaction is measured on
a scale of 0–10, and covers the main areas of the membership product,
including:
 TABLE 10.1 MEMSAT satisfaction scores and drivers of Australian sport
teams
Area of Member Services Ave Score (0–10) Ave Importance of Factor (%)
Arrangements and Ticketing 7.9 29
Personal Involvement 7.5 22
Administration 7.7 13
On-field Performance 6.6 13
Home Ground 8.1 10
Communication 8.1 7
Service to Members 8.3 6

arrangements and ticketing (seating, packages offered, ease of purchase,

speed of delivery etc.)
service to members (enquiry handing, speed of service, helpfulness of staff,
complaint handling, etc.)
club communications (website, email updates, social networking, etc.)
on-field performance (number of games won, level of match quality, etc.)
personal involvement (voting rights, social opportunities, recognition of
members, etc.)
club administration (board performance, financial performance,
professionalisation and promotion of the club, etc.)
home ground (facilities, atmosphere, feeling of ground, etc.).

In addition to the specific aspects in Table 10.1, overall satisfaction scores and
outcomes such as value perception and intention to renew as a member are part
of the survey tool. Satisfaction scores for sports teams generally range from as
high as 8.6 out of 10 to lows of 6.4, with most leagues averaging between 7.5
and 8.0.
Also shown in Table 10.1 is the relative importance of each aspect of the
membership product to overall satisfaction. This is determined using regression
analysis. The results show that, on average, perceptions of membership
arrangements contribute 29 per cent towards overall member satisfaction,
making it the most important factor when members assessed performance.
Personal involvement and administration were the next most important
contributors to satisfaction. It is noted that importance levels vary between clubs
as well. For some clubs, team communication or administration is not important
at all, while for others they contribute strongly towards overall satisfaction. This
 variation can result from members’ past experiences and expectations. For
example, if members expected to have regular communications from the club
and that did not occur, then communications were likely to have a stronger
impact on satisfaction than if they had been delivered as expected.
The results may also be surprising in that they suggest that winning (on-field
performance) is less important than providing good service quality and making
members feel involved. In line with the understanding that satisfaction can
result from more than just on-field results, this is good news for clubs: they can
be assured that if they manage the service components of their membership
offering well, their membership numbers should not rise and fall dramatically
with on-field results. Members, it seems, can still be satisfied with the
membership product even if the results of the games do not please them.

Questions
1. Based on this research, what are the areas on which you would recommend
that club membership managers focus? Give some specific
recommendations of actions they could undertake to improve member
satisfaction.
2. Why might on-field performance not be the most important thing to
members when they determine how satisfied they are with their
membership?
3. How else could a sporting club measure the quality of the service it is
offering its members? Or what extensions could be used in addition to the
survey process?
4. In even the best-managed leagues churn can be a problem, with many
sports club members not renewing their memberships each year. What
relationship would you expect between service quality, member
satisfaction and member renewal? Why would a satisfied club member not
renew, and what might be the implications of this for marketers?

References
An, B., Harada, M., & Sato, S. (2020). Service quality, satisfaction, and
behavioral intention in a triathlon event: The different experiences between
local and non-local participants. Journal of Sport Tourism, 24(2), 127–142.
Anderson, E., & Mittal, V. (2000). Strengthening the satisfaction-profit
chain. Journal of Service Research, 3(2), 107–120.
Beccarini, C., & Ferrand, A. (2006). Factors affecting soccer club season
ticket holders’ satisfaction: The influence of club image and fans’ motives.
European Sport Management Quarterly, 6(1), 1–22.
Berry, L., & Parasuraman, A. (1991). Marketing services: Competing
through quality. The Free Press, New York.
Berry, L., Parasuraman, A., & Zeithaml, V. (1988). The service-quality
puzzle. Business Horizons, 31(5), 35–43.
Biscaia, R., Yoshida, M., & Kim, Y. (2021). Service quality and its effects on
consumer outcomes: A meta-analytic review in spectator sport. European
Sport Management Quarterly.
https://doi.org/10.1080/16184742.2021.1938630.
Cameron, N. (2019, March 20). CMO interview: Building a marketing and
insights engine at Tennis Australia. CMO Australia.
https://www.cmo.com.au/article/658990/cmo-interview-building-marketing-
insights-engine-tennis-australia/.
Chelladurai, P. (1987). Multidimensionality and multiple perspectives of
organizational effectiveness. Journal of Sport Management, 1(1), 37–47.
Chelladurai, P., & Chang, K. (2000). Targets and standards of quality in
sport services. Sport Management Review, 3(1), 22–29.
Churchill, J.G.J., & Surprenant, C. (1982). An investigation into the
determinants of customer satisfaction. Journal of Marketing Research, 19(4),
491–504.
Cialdini, R. et al. (1976). Basking in reflected glory: Three (football) field
studies. Journal of Personality and Social Psychology, 34(3), 366–375.
Clemes, M.D., Brush, G.J., & Collins, M.J. (2011). Analysing the
professional sport experience: A hierarchical approach. Sport Management
Review, 14(4), 370–388.
Cronin, J., & Taylor, S., (1992). Measuring service quality: A reexamination
and extension. Journal of Marketing, 56(3), 55–68.
Giorgio, P., Deweese, C., Reichheld, A., & Ebb, S. (2018). The stadium
experience: Keeping sports fans engaged – and loyal. Deloitte Development
LLC.
https://www2.deloitte.com/content/dam/Deloitte/us/Documents/technology-
media-telecommunications/us-tmt-stadium-experience-keeping-sports-fans-
engaged-loyal.pdf.
Funk, D.C. (2017). Introducing a Sport Experience Design (SX) framework
for sport consumer behaviour research. Sport Management Review, 20(2),
145–158.
Garbarino, E., & Johnson, M.S. (1999). The different roles of satisfaction,
trust, and commitment in customer relationships. Journal of Marketing,
63(2), 70–87.
George, M., & Wakefield, K.L. (2018). Modeling the consumer journey for
membership services. Journal of Services Marketing, 32(2), 113–125.
Grönroos, C. (1990). Service management and marketing. Lexington Books,
Boston, MA.
Grönroos, C. (1992). Service management: A management focus for service
competition. In C. Lovelock (ed.), Managing services: Marketing,
operations, and human resources. Prentice Hall, Englewood Cliffs, NJ, 9–
16.
Hoffman, K.D., & Bateson, J.E.G. (2017). Services marketing concepts,
strategies, and cases (5th edn). Cengage Learning, Boston, MA.
Howat, G., & Assaker, G. (2016). Outcome quality in participant sport and
recreation service quality models: Empirical results from public aquatic
centres in Australia. Sport Management Review, 19(5), 520–535.
Howat, G., Absher, J., Crilley, G., & Milne, I. (1996). Measuring customer
service quality in sports and leisure centres. Managing Leisure, 1(20), 77–
89.
Iacobucci, D., Ostrom, A., & Grayson, K. (1995). Distinguishing service
quality and customer satisfaction: The voice of the consumer. Journal of
Consumer Psychology, 4(3), 277–303.
Jones, C.W., Byon, K.K., & Huang, H. (2019). Service quality, perceived
value, and fan engagement: Case of Shanghai Formula One racing. Sport
Marketing Quarterly, 28(2), 63–76.
Karg, A., McDonald, H., & Leckie, C. (2019). Channel preferences among
sport consumers: Profiling media-dominant consumers. Journal of Sport
Management, 33(4), 303–316.
Karg, A., McDonald, H., & Schoenberg, G. (2015). The immediate impact
of coach succession events on season ticket holder attitudes. Sport
Marketing Quarterly, 24(1), 30–42.
Karg, A., McDonald, H., & Shaw, R. (2008). A longitudinal analysis of the
halo effect of team success on season ticket holder attitudes. Gold Coast,
Queensland, Sport Marketing Association Conference.
Karg, A., Tamaddoni, A., McDonald, H., & Ewing, M. (2021). Predicting
season ticket holder retention using rich behavioral data. Journal of Sport
Management, 35(5), 426–439.
Kelley, S.W., & Turley, L.W. (2001). Consumer perceptions of service
quality attributes at sporting events. Journal of Sport Business Research,
54(2), 161–166.
Kim, D., & Kim, S. (1995). QUESC: An instrument for assessing the service
quality of sport centers in Korea. Journal of Sport Management, 9(2), 208–
220.
Ko, Y.J., & Pastore, D.L. (2001). A multidimensional and hierarchical model
of service quality in the participant sport industry. Research Quarterly for
Exercise and Sport, 72(1), A-109.
Kotler, P. (2000). Marketing management (10th edn). Prentice Hall, Upper
Saddle River, NJ.
Lam, E.T.C., Zhang, J.J., & Jensen, B.E. (2005). Service Quality Assessment
Scale (SQAS): An instrument for evaluating service quality of health-fitness
clubs. Measurement in Physical Education and Exercise Science, 9(2), 79–
111.
Lapidus, R., & Schilbrowsky, J. (1996). Do the hot dogs taste better when
the home team wins? Journal of Consumer Satisfaction, Dissatisfaction and
Complaining Behaviour, 9, 1–11.
Lee, M.A., Kunkel, T., Funk, D.C., Karg, A., & McDonald, H. (2020). Built
to last: relationship quality management for season ticket holders. European
Sport Management Quarterly, 20(3), 364–384.
Lovelock, C., Patterson, P., & Walker, R. (2001). Services marketing: An
Asia-Pacific perspective. Pearson Education, Sydney.
Madrigal, R. (1995). Cognitive and affective determinants of fan satisfaction
with sporting event attendance. Journal of Leisure Research, 27(3), 205–
227.
McDonald, H., & Shaw, R. (2005). Satisfaction as a predictor of football
club members’ intentions. International Journal of Sports Marketing and
Sponsorship, 7(1), 75–81.
McDonald, H., Karg, A.J., & Leckie, C. (2014). Predicting which season
ticket holders will renew and which will not. European Sport Management
Quarterly, 14(5), 503–520.
McDonald, H., Karg, A.J., & Vocino, A. (2013). Measuring season ticket
holder satisfaction: Rationale, scale development and longitudinal
validation. Sport Management Review, 16(1), 41–53.
McDonald, H., Leckie, C., Karg, A., & Zubcevic-Basic, N. (2018). Female
season ticket holders: How their satisfaction is derived differently from
males. European Sport Management Quarterly, 18(2), 156–174.
McDonald, M., Sutton, W., & Milne, G. (1995). TEAMQUAL: Measuring
service quality in professional sports. Sport Marketing Quarterly, 4(2), 9–15.
Mullin, B., Hardy, S., & Sutton, B. (2007). Sport marketing (3rd edn).
Human Kinetics, Champaign, IL.
NBA. (2012). Satisfaction guaranteed night.
http://www.nba.com/suns/guaranteed.
NBA. (2020, March 5). Sacramento Kings launch new ‘Royalty Pass’
program to enhance the fan experience.
https://www.nba.com/kings/news/sacramento-kings-launch-new-royalty-
pass-program-enhance-fan-experience.
Oliver, R.L. (2010). Satisfaction: A behavioral perspective on the consumer
(2nd edn). M.E. Sharpe, Armonk, New York.
Olya, H., Taheri, B., Farmaki, A., & Gannon, M.J. (2021). Modelling
perceived service quality and turnover intentions in gender-segregated
environments. International Journal of Consumer Studies, 1–18.
https://doi.org/10.1111/ijcs.12664.
Parasuraman, A., Zeithaml, V., & Berry, L. (1985). A conceptual model of
service quality and its implications for future research. Journal of Marketing,
49(4), 41–50.
Parasuraman, A., Zeithaml, V., & Berry, L. (1988). SERVQUAL: A
multiple-item scale for measuring consumer perceptions of service quality.
Journal of Retailing, 64(1), 12–37.
Peterson, R., & Wilson, W. (1992). Measuring customer satisfaction: Fact
and artifact. Journal of the Academy of Marketing Science, 20(1), 61–71.
Pierce, J. (2012, March 16). Titans guarantee they will beat Melbourne
Storm or give away free tickets. Fox Sports.
https://www.foxsports.com.au/nrl/nrl-premiership/gold-coast-titans-
guarantee-they-will-beat-melbourne-storm-or-give-away-free-tickets/news-
story/37d449f147239ffac0a7a16c9213cc79.
Polyakova, O., & Ramchandani, G. (2020). Perceived service quality among
regular users of gyms in public sports centres in the UK. Managing Sport
and Leisure, 1–20.
Reeves, C., & Bednar, D. (1994). Defining quality: Alternatives and
implications. Academy of Management Review, 19(3), 419–445.
Rust, R., & Oliver, R. (1994). Service quality: Insights and managerial
implications from the frontier. In R. Rust & R. Oliver (eds), Service quality:
New directions in theory and practice. Sage Publications, Thousand Oaks,
CA, 1–19.
Hernández, K. (2021, February 9). On the hardwood: Sacramento Kings
improve in-venue, at-home experience with Intel True View at Golden 1
Center. Sports Video Group News.
https://www.sportsvideo.org/2021/02/09/on-the-hardwood-sacramento-
kings-improve-in-venue-at-home-experience-with-intel-true-view-at-golden-
1-center.
Statistica. (2020). Number of members of FC Bayern Munich from 2005/06
to 2017/18. https://www.statista.com/statistics/495643/fc-bayern-munich-
number-of-members/.
Theodorakis, N., Alexandris, K., Tsigilis, N., & Karvounis, S. (2013).
Predicting spectators’ behavioural intentions in professional football: The
role of satisfaction and service quality. Sport Management Review, 16(1),
85–96.
Theodorakis, N., Kambitsis, C., Laios, A., & Koustelios, A. (2001).
Relationship between measures of service quality and satisfaction of
spectators in professional sports. Managing Service Quality, 11(6), 431–438.
Thorndike, E.L. (1920). A constant error in psychological ratings. Journal of
Applied Psychology, 4(1), 25–29.
Tsitskari, E., & Tsakiraki, A. (2013). Does satisfaction affect a member’s
psychological commitment to a fitness center? Journal of Physical
Education and Sport, 13(4), 522–527.
Van Leeuwen, L., Quick, S., & Daniel, K. (2002). The sport spectator
satisfaction model: A conceptual framework for understanding the
satisfaction of spectators. Sport Management Review, 5(2), 99–128.
Veeck, B., & Linn, E. (1962). Veeck – as in wreck: The autobiography of Bill
Veeck. New American Library, New York.
Wakefield, K., & Sloan, H. (1995). The effects of team loyalty and selected
stadium factors on spectator attendance. Journal of Sport Management, 9(2),
153–172.
Yoshida, M., & James, J. (2010). Customer satisfaction with game and
service experiences: Antecedents and consequences. Journal of Sport
Management, 24(3), 338–361.
Yuksel, M., Smith, A.N., & Milne, G.R. (2021). Fantasy sports and beyond:
Complementary digital experiences (CDXs) as innovations for enhancing
fan experience. Journal of Business Research, 134(8), 143–155.
Zeithaml, V. (1991). How consumer evaluation processes differ between
goods and services. In C. Lovelock (ed.), Services marketing (2nd edn).
Prentice Hall, Upper Saddle River, NJ.
Zeithaml, V., Bitner, M.J., & Gremler, D. (1990). Delivering service quality:
Balancing customer perceptions and expectations. The Free Press, New
York.
CHAPTER 11

Sport sponsorship

DOI: 10.4324/9781003270522-14

Chapter objectives
Chapter 11 introduces the concept of sponsorship, one of the most visible
elements of the sport promotion mix. Initially, sponsorship is defined and the
various aims and objectives for sponsorship are introduced before we address
the stages of sponsorship management including presentation of a sponsorship
management framework. Also in this chapter, we introduce the way sponsorship
works and the different methods that can be used to evaluate the effectiveness of
sponsorship, considering its effects with regard to the goals set by the sport
sponsor. Sponsorship of individual athletes, ambush marketing and future trends
are also considered in the chapter.
After studying this chapter, you should be able to:

describe and define sponsorship as a distinctive element of the sport

promotion mix
describe the stages for managing a sponsorship arrangement, including
objective setting, implementation and leveraging
describe different methods of measuring sponsorship effectiveness
understand the principles that underpin ambush marketing.

Headline story
Building global sponsorship portfolios
Each year a report titled Football Money League, published by Deloitte, reports
on the growth and status of revenue streams of the top Association football
(soccer) clubs in the world. At the top of the list are large global powerhouses
that often have large and increasing revenue bases related to broadcast, ticketing
or matchday and commercial streams. Despite the cited global power of media
and broadcast rights for professional sport, it is commercial revenue that is the
dominant contributor for teams atop this annual list. For example, in 2021 the
Football Money League top four teams (Barcelona, Real Madrid, Bayern
Munich and Manchester United) generated between 47 and 57 per cent of their
revenue via commercial streams (see Jones, 2021).
Local and traditional forms of sponsorship assets play a major contributing
role in these figures. Player shirt and kit sponsorship, stadium naming rights and
at-game signage pour millions into club accounts each year. Increasingly though
clubs have been looking beyond their domestic markets to further grow and
commercialise fan bases in a more pronounced and deliberate way. While each
of the four teams cited above have always been global brands, the last decade
has seen further development of specific international strategies to build,
globalise and commercialise football teams as brands.
 Such deals have often been seen as category- or region-specific. For
example, a team may sign a technology or telecommunications partner in one
region, a milk or dairy company in another region and a car tyre brand in yet
another. In recent structural shifts to global rights, teams have transitioned
towards larger partners or brands, taking ownership of a product category
globally.
In each example such brand partnerships are strategic and linked to particular
objectives and outcomes for both the sport team (sponsee) and the brand or
sponsoring organisation (sponsor). Agreements often include the rights to
associate with the team, as well as leveraging of brand components such as
player, stadium and team assets in campaigns. Increasingly, leveraging digital or
online rights to extend reach to global markets and fans provides further value
to sponsors.

What is sponsorship?
Historically, sponsorship was often associated with charity and altruism.
However, as it evolved towards a modern business environment, including the
sport setting, sponsorship as a concept changed significantly and is now an
important marketing tool for many organisations. Meenaghan (1991, p. 36)
defined sponsorship as: ‘an investment in cash or kind, in an activity, in return for
access to the exploitable commercial potential associated with that activity’.
Critical to sponsorship are key characteristics that differentiate it from other
partnerships between or across organisations. The first is the presence of a
reciprocal business relationship where, under the premise of exchange theory, one
party contributes something of value and the other party returns the favour. The
second is a commercial advantage sought by one or both parties as part of the
sponsorship arrangement. Collectively, these characteristics seek to differentiate
sponsorship from a range of other organisational partnerships (Seitanidi & Ryan,
2007). These include differentiation from aspects such as philanthropy or
patronage, where an asymmetric relationship exists (i.e., one party does not
expect, or receive, a benefit). Rather, such arrangements are motivated by
altruism, where perhaps public recognition is expected in return for a donation
from an organisation or individual whose support serves the public good. In
addition, there are other forms of partnerships where sport organisations may be
involved, including cause-related marketing, corporate social responsibility and
community-orientated partnerships (Rowe et al., 2018). However, these will often
not meet the criteria for sponsorship, given the aspects of exchange and
commercial benefit inherent in its definition.
Within the concept of sponsorship many options, or assets, can be the feature
of the arrangement. Sport is particularly prolific as a form of sponsorship, with
the largest segment of sponsorship revenue flowing to sport organisations. While
sponsorship broadly involves the ‘right to associate’, individual sports, events,
competitions or leagues, athletes or individual performers can also be considered
as assets of value. Coaching, development and educational programmes,
broadcasts, stadia and trophies and awards likewise have been part of sponsorship
arrangements. Perhaps well aligned with this diversity, there are a range of
objectives that organisations seek to elicit from sponsorship, and a range of
benefits that can accrue – some more measurable than others. Such breadth in its
application is one of the key reasons sponsorship has become a prominent asset in
sport marketing.

The market for sponsorship

Sponsorship has grown rapidly in the past decades, with particular development
in investment through the 1990s and 2000s. This was spurred by the increasing
profile and accessibility of sport as well as acceptance of commercialisation and
corporate involvement in sport, which made both organisations and sport
consumers more comfortable and accepting of the role, and visual presence, of
corporate brands in sport. Changes to marketing theory, including a focus on
providing varied promotional messages and tools across segments, worked in
favour of the sponsorship medium, which was seen to be able to offer a range of
benefits, often concurrently. Further, the environmental setting of prior decades
provided fertile conditions for sponsorship to grow, with increasing economic
strength and legal changes (e.g., bans on advertising some products).
While exponential levels of growth of the prior decades many have slowed, the
2010s saw continued investment for the medium. Sponsorship spend was
estimated to rise from approximately US$45 billion in 2009 to over US$65 billion
in 2019 (Guttmann, 2019), with the dominant North American and European
markets projected to account for just under two-thirds of this amount. Reflective
of the recent growth of commercial sport in the Asian region, these two markets
combined with Asia were said to represent 93 per cent of all sponsorship spend.
Although these figures are only estimates, it can be argued that this is a huge pool
of potential funds for sporting organisations – particularly where the majority of
spend on sponsorship is attributed to sport (IEG, 2020).
 While there are a range of different levels, properties and assets that can be
sponsored, one of the primary cases of sponsorship success is The Olympic
Partner Programme (TOP), a key source of funding for the International Olympic
Committee (IOC). Since its inception in 1985 TOP has generated billions in cash
and in-kind services for the Olympic movement. It grew nearly 1000 per cent in
the space of six Games cycles between the 1988 Seoul Olympics (US$96 million)
and London 2012 (US$957 million), and is expected to generate US$3 billion in
2021 to 2024 (Owen, 2021). This typifies the growing commercialisation and
importance of sponsorship, with a core driver being the interest and competition
from new corporations that want to enter the programme in an attempt to reach
global markets, including the substantial media and digital audiences involved
with the delivery of Olympic events.

SPORTVIEW 11.1
The rise and value of digital sponsorship assets
It is argued that global, highly engaged audiences make sport and its
sponsorship properties unrivalled as a marketing platform (Stephan, 2019). This
remains true even as new and digital media are evolving as a base for
communication and commercialisation for sport organisations. Entities
including clubs, athletes and governing bodies are increasing their use of new
media platforms, including websites, direct channels and social networking
sites, to deliver customised messages to consumers and fans.
While useful for an organisation’s own promotions and operations, such
transition – as well as often large, passionate fan bases as assets – creates a new
and highly valuable range of digital assets for sport rights-holders. This is
particularly the case as the last few years has seen more people watching digital
platforms than linear TV (Zenith, 2018), combined with markets where digital
spend from brands exceeds other forms of global advertising expenditure
(Dentsu, 2021).
While rights-holders have traditionally been seen to significantly undervalue
their audiences, and digital communications with audiences (Greenroom
Digital, 2021; Stephan, 2019), sports rights-holders are now faced with
increasing opportunities to proactively package digital rights, assets and
inventory for sale to sponsors. For example, brands that are focused more on
technology-enabled direct-to-consumer communications, e-commerce sales
channels and sophisticated data strategies can work with sport organisations and
a professional sports team can instantaneously reach a specific market segment
within the team’s fan base with a targeted message. Such digital rights for
 sponsorship have often been an ‘add on’ for sponsors, and undervalued as sport
rights-holders struggled with the positioning and conversion of digital assets
and rights into value. In a modern setting, such digital rights and
communication opportunities for partners can be delivered via content
platforms, digital apps, direct email or SMS or social media platforms, as well
as through a wide range of campaign or content marketing strategies.
As such, digital rights and assets represent a main growth area of
sponsorship. Organisations that can package, communicate and demonstrate the
value of their data and digital assets can begin to command a greater share of
sponsors’ budgets. Further, while physical assets may come at additional costs,
digital branding or communications have limited such costs outside of the
original sponsorship agreement. They can also deliver tangible and measurable
benefits. As noted by Stephan (2019): ‘Using the right data and evaluation
products, rights-holders can measure and guarantee the number of engagements
and impressions a brand will receive through digital channels, and as a result,
show how that is shifting brand awareness, purchase intent or leads generated.’

Managing sponsorship
As sponsorship has increased in its scope and resourcing, it has required deeper
consideration of the management practices used to drive value from investment.
For some time, researchers noted that increases in the sophistication of
management techniques was not parallel with the growth of sponsorship
(Chadwick & Thwaites, 2004; Séguin, 2008). Certainly, the volume of spend and
subsequent accountability aligned with spend has seen evidence of improving
processes. When considering the stages of sponsorship management, multiple
frameworks exist that detail their components (Arthur et al., 1998; Chadwick &
Thwaites, 2005; Cornwell, 1995). The elements in each are noted as overlapping
in both the areas defined and their order or progression (Karg, 2007). Strategic
considerations of planning, strategy and objectives are common foundations,
often inclusive of the alignment of sponsorship with corporate and marketing
strategy as well as the target market it seeks to impact. Selection and decision-
making processes, implementation of the sponsorship (inclusive of leveraging and
integration with other marketing operations) and evaluation or measurement are
other well-supported categories of sponsorship management.
While much of the work considering sponsorship management has been
conducted via a linear understanding of the management components, the
viewing of sponsorship as part of a cyclical framework provides an alternative,
and arguably more realistic and integrated, way to consider the stages of
sponsorship measurement (Karg, 2007). Figure 11.1 provides a summary of such,
presenting a cyclical framework under which the stages of sponsorship can be
considered. This is aligned with a view that sponsorships are assessed and
managed by companies on a cyclical basis, allowing them to be considered as
broken into multiple years or cycles. Further, the cyclical nature links the start
and end of the process, and promotes ‘application of learning’ and ongoing
improvement to organisation practices.

Figure 11.1 Sponsorship management: a cyclical approach

The framework commences with an understanding of sponsorship strategy and

planning. Here the critical elements are those of aligning an organisation’s
corporate strategy, its wider and more general marketing strategy, with that of its
specific sponsorship aims. Such alignment, as well as the philosophy of the
organisation and a general understanding of what it wants to achieve, is among
the strategic considerations at this stage. Aspects of understanding what portfolio
of asset or sponsorship properties the organisation may wish to engage with, as
well as its overall goals and objectives for engaging in sponsorship and budget
considerations, are also part of the early strategic stages. The following sections
and remainder of the chapter will provide an overview of sponsorship goals,
objective and effects, implementation and measurement.

Sponsorship goals and objectives

In marketing, it is common to look at different marketing tools – like sponsorship
– from an applied point of view. In other words, how can we use this tool (that is,
money, resources or services) to reach sales-related goals? This is the perspective
of the sponsoring organisation. From the sporting organisation’s point of view, the
main goal of sponsorship is not sales-related. Sporting organisations or individual
athletes mainly use sponsorship to accumulate funds, resources or services. These
are then used to run the operations of the organisation or brand.
Historically, the sponsorship tool was seen as closely aligned with forms of
advertising or public relations (PR). However, sponsorship has developed as an
independent and important element of the promotions mix (per Chapter 9) and
clearly stands apart from other promotion mix elements. Advertising is defined as
a non-personal communication by an identified brand or organisation. From the
sponsor’s point of view, the difference between sponsorship and advertising is the
actual content of the message, and how that message is communicated. In
advertising, the content of the message and the moments of communication are
determined by the paying organisation. When using sponsorship, however, the
sponsor provides financial or material support for what are often independent
organisations, individuals or activities. In sponsorship, less control can be
exercised over the communication through these entities, and the timing of
communication cannot be controlled. Although indirect (through the sponsored
organisation), the actual message is often communicated at a more personal level
(for example, to people visiting an event or consumer content related to the sport
brand). Likewise, PR goals such as ‘earning understanding and acceptance’ and
‘creating goodwill’ can be aligned with, but distinct from, sponsorship. The fact
that the organisation has to pay for the association with the sponsored
organisation, and that communication takes place through an independent
organisation, distinguishes sponsorship from pure public relations.
While related to other marketing tools, sponsorship has distinct goals and
opportunities that can be classified, for example, as media, corporate, marketing
and sales objectives. It has long been suggested that objectives will be mixed and
wide-ranging, with multiple objectives seen to be a feature of sponsorship
(Meenaghan, 1983). Table 11.1 provides an example of some of the goals and
objectives sponsors may have when entering a sponsorship agreement, including
maximising brand visibility and exposure or enhancing existing advertising as
forms of media objectives. Marketing objectives may assist in shaping or
communicating the image, or positioning, of a product or brand. Conversely,
corporate objectives can include use of hospitality assets or entertainment
benefits, or involvement with an event to benefit or advance the image or health
of the corporate brand or organisation. Finally, direct sales objectives can be set
and achieved via direct product sales at events (e.g., selling a soft drink at the
event) or by using an event to increase sales or distribution channels as part of the
event.
Table 11.1 Sponsorship objectives
Category Sample Objectives
Maximise exposure
Media Enhancement of advertising
Counter negative publicity
Community relations/image
Business relationship management
Client entertainment/hospitality benefits
Corporate
HR objectives
Employee relationship management
Business development
Raising awareness
Marketing Brand/image health
Product positioning and image
Direct sales at event
Increase sales/customers
Sales
Enhancing/developing channels/ distribution
Increase targets/consumer information

Effects: how does sponsorship work?

The effects of sponsorship can work in myriad, and often interrelated ways.
Figure 11.2 provides a structure by which each of the groups of sponsorship
objectives noted in Table 11.1 can be linked with specific effects, with
opportunities to consider progression between the sets of objectives as part of a
hierarchy of effects. In this setting, exposure presents as a necessary precondition
for a sponsorship association to exist (Speed & Thompson, 2000), with media
objectives a common method of maximising brand exposure that in turn provide
for leveraging the early cognitive effects of awareness and association. Most
commonly, marketing and corporate objectives target changes in image and
awareness, levels of brand loyalty, credibility or positioning at the marketing
level or image, goodwill, perception or relations at the corporate level. Therefore,
these cognitive effects or outcomes are resultant changes to exposure that build
familiarity and recognition of a brand, then seek to advance consumers toward
positive perceptions and feelings about the company or brand – in line with the
AIDA (attention, interest, desire, action) model presented in Chapter 9. In other
words, the sponsor attempts to forge a connection between the sponsorship
property (that is, the event or athlete) and the company or brand. The assumption
is that a value transfer from the event or athlete to the company or brand occurs,
in the process achieving sponsorship objectives. Finally, sales objectives target
direct sales or result in behaviours whose outcome is sales or revenue gains. In
looking at on-site sales, developing new sales channels, product trial or goals
such as increased market share, sales promotions or gaining new customers, these
objectives are attempting to stimulate a behavioural response from a consumer or
trade partner. The actual sales are often a result of exposure (media objectives)
and cognitive progression (corporate and marketing objectives) created, and
therefore a flow of effects can be determined within sponsorship objectives.

Figure 11.2 How sponsorship works

It should be noted that the selection of sponsorship properties should be

considered in line with their ability to cultivate very different outcomes. As such
the formulation of specific sponsorship objectives is critical when selecting the
right sponsorship entity, in turn affecting the different measures to be used when
assessing the effectiveness of the sponsorship partnership. The practical value of
the AIDA model and hierarchy of effects lies in their ability to conceptualise how
a consumer may move from being unaware of a product, brand or organisation to
thinking more positively about the brand, considering it and buying it. As may be
observed from the model, it is much harder to define clear-cut objectives and
sponsorship properties for the interest and desire stages than it is for the attention
and action stages. It is thus very important to remember that the mid-stages of the
sponsorship process are transitory.
In maximising the positive effects of sponsorship investment, integration and
leveraging activities can play a critical role. As organisations and brands execute
the practical components of a sponsorship, they will often seek to create
efficiencies or amplify the impact of the sponsor alongside other marketing or
promotional activities. This can be referred to as ‘leveraging’ a sponsorship, and
can involve the sponsor investing in other brands or promotional activities to
enhance the effectiveness of the partnership and its benefits. For example, a
sponsor who has signage or branding positioning at a sport event may extend or
amplify the impacts of their sponsorship via perhaps an advertising strategy
(digital or otherwise) with the broadcaster of the event, or by running a fan
activation or product trial site at the event. Increasingly, digital rights as part of
sponsorship are providing sponsors with access to attendee or season ticket-
holder bases to allow direct communication or targeting benefits. By doing so, the
sponsor can integrate the sponsorship assets they own rights to with other
promotional activities of the brand, ideally creating a consistent and magnified
impact.

Sponsorship measurement
When the complete sponsorship programme is put into action, it is important for
both sponsor and sponsee to measure its effectiveness. Aligned with Figure 11.1,
objectives and measurement can be interrelated, with early practices proposing
objectives should facilitate the establishment of evaluation criteria for selection as
well as contributing towards the foundations of post-event measurement or in a
manner that allows for future evaluation (Irwin & Asimakopoulos, 1992; Karg,
2007). However, given the diversity of objectives that can be yielded from
sponsorship (essentially covering a wider ‘buyer-readiness continuum’) or
categories of corporate, marketing, sales and media objectives (Hansen &
Scotwin, 1995), challenges can exist in isolating and measuring the individual or
cumulative effects of these objective and activities. Most clearly, the major
distinction in objective forms is between direct (sales) and indirect (exposure)
marketing objectives.
Commonly, exposure is the broadest measure of sponsorship effectiveness.
Usually a function of monitoring external media, it measures how many times (in
seconds on television, or number of columns and photographs in print media) an
organisation or brand is observable (Breuer & Rumpf, 2012). Analysis of
demographics and audiences is included in calculations, and often a final figure is
in impressions or a dollar value of coverage. Television exposure, for example, is
measured by multiplying seconds by the number of viewers, and therefore
expressed as ‘exposure per 1000 viewers in 30 seconds’. New techniques use
artificial intelligence (AI) and eye-tracking software to complement the above
inputs by measuring the sponsor’s exposure (size of screen share) and
‘exclusiveness’ (lack of other sponsors in the same screen shot) (Breuer &
Rumpf, 2012). This technique differentiates the value of sponsorships – for
example, between a jersey sponsor (large exposure and exclusive position in
frequent player close-ups during telecast) and ground or digital signage
(infrequent and small exposure in a cluttered space with other sponsors during
telecast). Recent approaches have sought to quantify more closely the intellectual
property (IP) and brand benefits and their value as part of this exchange.
Exposure value can be compared with advertising value by multiplying
seconds (30) by advertising rates for 30-second commercials. The resulting value
presents the sponsor with the money figure that would have been paid had the
sponsor invested the money in 30-second commercials. However, there are
significant problems with these measures of effectiveness. For example, how do
we know that viewing a 30-second commercial equals the value of viewing 30
seconds of scattered brand exposure throughout an event broadcast? This problem
is compounded when one realises how hard it is to accurately measure the
number of viewers, given the fragmentation and proliferation in broadcast and
content platforms. These problems relate to the fact that exposure is one thing,
but what really matters is the impact of the exposure.
However, volume of exposure is only the start of measuring the effect of
sponsorship, and commonly is accepted as a ‘lower-order measurement’. A better
measure of impact is how much attention people pay to a brand or an
organisation. Attention can be measured in terms of changes in recall or
recognition by individual members of the target market (McDonald & Karg,
2015). Recall is the more powerful measure of effectiveness in that research
subjects are not aided in recalling sponsors’ names. In recognition, subjects are
asked to choose from a list of possible sponsors. The benchmark for measuring
attention has to be the recall or recognition measure before entering the
sponsorship agreement. This may be achieved through pre-testing; otherwise,
changes in recall or recognition cannot be measured. Cognitive effects also can be
measured in individuals who are part of the sponsor’s target market(s). For
example, the association between a car manufacturer and a car-racing event
evokes a stronger cognitive effect than the association between a car
manufacturer and a tennis event. The car manufacturer–car-race link is logical,
and requires little explanation. The car manufacturer–tennis event link is expected
to evoke a more general association, and tries to link the image of the event to the
image of the car.
Both effects are often measured in associative tests, with various consumer
tracking and survey mechanisms used to assess various cognitive impacts. For
example, given the Australian Open tennis championships, the question ‘Which
sponsors do you associate with this event?’ can be asked. One can even consider
using research techniques that compare people’s attitudes about different brands,
including brands that compete with the sponsor’s. Tracking studies, where factors
such as brand image are examined over an extended period of time, also fit the
category of measuring cognitive effects. Cognitive tests are better described as
qualitative research techniques because they deliver information that allows the
researcher to explain consumer behaviour rather than the quantified measures that
result from media monitoring. Cognitive research becomes more important
towards the ‘desire’ and ‘action’ stages of buyer readiness – where brand
attitudes, consideration and consumer intentions become more prominent. While
often the focus of research that seeks to capture attitudes and intentions to
purchase or support a sponsor based on sponsorship exposure, there are
challenges as to how reliable such measures are when it comes to actual
consumption or purchase of the sponsor’s brand (Zaharia et al., 2016). In addition
to the potential lack of reliability, one limitation of cognitive analysis is that it can
give ad hoc or limited results of effects for markets beyond consumers.
Logically, the most direct measure of sponsorship effectiveness is buying
behaviour. In short, what are the effects of the sponsorship on attitudes to buying,
or even on the direct sales figures or turnover of the organisation or the sales
figures of certain product lines? In this case, the benchmark for measurement has
to be set before the sponsorship. However, the delay between sponsorship
activation and consumer buying response may be lengthy. Behavioural
measurement of sponsorship has often been criticised because of the difficulties
involved in isolating the effects of sponsorship on sales and turnover from those
of other promotion mix tools. Experimental research designs or historical tracking
of prior promotion and non-promotion impact may help the researcher isolate the
impact of sponsorship investment. However, difficulties in isolating effects
remain, and often little formal measurement is conducted outside of sales
analysis.
As alluded to above, there are limitations to measuring sponsorship
effectiveness at each of the levels here. As such, effectiveness is a difficult issue,
and is often the least resourced and targeted component of sponsorship
measurement. How effectiveness is measured depends on the sponsor’s goals, and
even then many variables can influence effectiveness. Further, it can be difficult
to measure and isolate discrete effects of sponsorship from other areas. We
mentioned earlier that integration with sponsorship and other promotional
mediums (i.e., advertising or digital campaigns) are encouraged, but this can lead
to overlapping effects. How can a sponsor be sure that gains in consideration or
sales are coming from sponsorship as opposed to concurrent advertising or PR
initiatives? Further, effects of sponsorship are not time-bound. For example,
while the value of sponsorship may occur immediately for some consumers, in
other instances awareness and consideration benefits take time to be fully
realised. Further, benefits may be felt long after a sponsorship agreement and
contract benefits end or expire. In sum, while measurement should be encouraged
as a critical activity, effects can be difficult to attribute to an activity or time
period. Such issues can see managers ignoring results or measurement aspects, or
placing less focus on measurement of sponsorship effects.

Sponsorship properties: a focus on events and athletes

It can be argued that there are hundreds of sponsorship opportunities, including
sponsoring the name or title of an event or stadium, broadcast sponsorship,
location sponsorship (for example, the 15th green during a golf event), leader-
board sponsorship, corporate hospitality suites, athletic apparel sponsorship (e.g.,
shoes, match kit) – the list goes on. It is largely up to the creativity of sport
marketers to come up with new ways of packaging ‘rights to associate’ for
sponsors to buy and use. Irrespective of how this is done, the majority of
sponsored properties in sport can be categorised as either events or athletes. As
noted earlier, what principally determines the success of the sponsorship is the
amount of exposure received and the impact that exposure has on the
sponsorship’s objectives.

SPORTVIEW 11.2
Sport and celebrities: a whole new ball game
Jonathan Robertson and Tom Benetti-Baker
There are few sports celebrities who can consider themselves truly global.
For a start there are few ‘global’ sports that have high appeal in all
economically significant countries. And, with the exception of football (and
maybe basketball), truly global sports are often individual sports such as tennis,
golf, Formula 1 racing and boxing. Therefore, the pool of celebrity athletes that
a global brand can leverage often comprises only a few dozen individuals.
Specifically, over the past 20 years there have only been six celebrity athletes at
 the top of the Forbes highest-paid list, and from four sports: boxing (Floyd
Mayweather, 2018, 2015, 2014, 2012); golf (Tiger Woods, 2013, 2011–2001);
tennis (Roger Federer, 2020); and soccer (Lionel Messi, 2019; Cristiano
Ronaldo, 2017–2016) (Anderson, 2020).
It’s quite amazing that Federer was able to top the list for the first time for
any tennis player at the age of 38 years in 2020. According to Forbes
(Badenhausen, 2020a), Federer was able to earn $100 million from
endorsements and appearance fees alone, with those endorsement fees coming
from the 13 brands in his portfolio, including Uniqlo, Rolex, Mercedes-Benz
and Wilson. Like basketball star Michael Jordan before him, the article stated
that Federer has benefited in endorsement dollars from his ability to ‘command
a sport with a global audience for years; appeal to both men and women; stay
out of trouble; add in a dose of swagger and a dash of charisma’. In 2018,
Federer signed a contract to partner with Uniqlo for $300 million over 10 years,
splitting from Nike, which he had endorsed for 20 years. Uniqlo were attracted
to Federer because of his on-court status as the greatest of all time as well as the
parties’ shared belief in bringing positive change to the world.
Despite Roger Federer being the first tennis player to top the Forbes highest-
paid athletes list since its inception in 1990, in 2020 the top nine in the list of
highest-paid female athletes were all tennis players. Naomi Osaka earned $37.4
million from her endorsement deals in 2020, finishing ahead of Serena Williams
and Ashleigh Barty in total earnings. Osaka’s earnings were the highest in
history for a female athlete, and in tennis only Roger Federer made more money
through endorsements in 2020 (Badenhausen, 2020b). Osaka currently endorses
15 brands, including Nissan, Shiseido, Yonex and Nike, the latter having agreed
to pay her $10 million per year to endorse their brand through to 2025
(Newcomb, 2019). Osaka’s success in terms of brand endorsement deals could
be attributed to her propensity to speak her voice and advocate for social
change. Nielsen Sports found that when athletes post on social media
advocating for social change they receive 63 per cent more engagement for
brands: ‘This underlines the potential benefits for brands who partner with
athletes prepared to take a stand or voice their opinion on a cause that resonates
with fans’ Nielsen Sports (2021).

Per Sportview 11.2, athlete sponsorship provides a prominent category whereby

brands can associate with a sport as well as with individuals themselves. As well
as the personality of a star athlete, growth in social media marketing platforms
have enabled athletes to build and cultivate large media followings, which are
attractive to sponsors and partners. While volume of followers is one form of
currency, organisations realise that young people are more likely than older
people to be influenced by athlete celebrities. Therefore, the target market with
which organisations want to communicate through athlete celebrities has to be
selected carefully.
When using high-profile celebrities, organisations run the risk that the message
or product they want endorsed will be overshadowed by the celebrity. Because
high-profile celebrities are attractive to a mass audience, many organisations want
them to endorse their messages. This can easily lead to overexposure of the
athletes, which will make the messages they communicate less credible. Belch
and Belch (2018) suggest that, when communicating a message, the credibility
and attractiveness of the source are of particular importance. Credibility and
attractiveness are therefore the concepts to consider when organisations choose to
use athletes as their source of communication.

Advantages and disadvantages of sport sponsorship

In assessing its unique offering, it was shown above that sponsorship has distinct
characteristics from other elements of the promotions mix. Sponsorship in a sport
context allows the sponsor to communicate more directly and intimately with
their target market (in this case, the people interested in the sporting organisation
and its products). In Chapter 1, some unique characteristics of the sport product
are listed, some of which are also applicable when discussing the advantages of
sport sponsorship. First, sport consumers tend to identify personally with the
sport, which creates opportunities for enhancing brand loyalty in products linked
to the sport. In other words, sport evokes personal attachment, and with this the
sponsor can be linked to the excitement, energy and emotion of the sporting
contest. Put simply, sport has the potential to deliver a clear message. Sport has
universal appeal and pervades many elements of life (geographic, demographic
and socio-cultural). This characteristic presents the opportunity to cross difficult
cultural and language borders in communication, enabling the sponsor to talk to a
(global) mass audience.
At the same time, the variety of sports available makes it possible to create
distinct market segments with which a sponsor is then able to communicate
separately. The universal appeal and strong interest in sport give it a high level of
media exposure, resulting in free publicity. This can make a sponsorship deal very
cost-effective. Thousands of dollars of advertising expenditure can be saved when
a sporting organisation or athlete attracts a lot of media attention. This makes
many organisations want to be associated with sport. Also, because of the clear
linkage of the sponsor to a sporting organisation or athlete, sponsorship stands out
from the clutter – contrary to mainstream advertising, in which people are
bombarded with hundreds of messages each day.
With so many advantages, why do organisations not simply spend their entire
promotional budget on sponsorship? Well, there are some disadvantages to be
considered before entering into a sponsorship agreement. In ambush marketing
(discussed below), non-sponsors take advantage of the efforts of real sponsors in
that they try to be associated with the sponsored organisation, event, product or
athlete. Lack of control over media coverage and the message delivered and
received is another disadvantage of sport sponsorship. Also, the media are
sometimes reluctant to recognise the sponsor’s name when reporting on events or
the achievements of athletes. Achievements of teams or athletes are another area
that cannot be controlled. A team performing poorly or an athlete who behaves
badly (on or off the field of play) will have a direct influence on the public’s
perception of the sponsor. As noted above, some measurement aspects of
sponsorship can also be difficult to reliably evaluate and quantify.

Ambush marketing
Ambush marketing is where an organisation or brand (that is not an authorised
sponsor) attempts to leverage the goodwill, reputation and popularity attributed to
a sport event by seeking to create an association with it, without permission to do
so. Attitudes to the practice have been mixed, with Chadwick et al. (2014) noting
views of ambush marketing as ‘illegal, unauthorized and immoral practice, while
in other cases it is regarded as legal, imaginative and an associative marketing
activity’ (p. 63). Ambush marketing can include examples such as where a small-
town butcher uses sausages to replicate the shape of the Olympic rings in his shop
window, through to where major apparel brands release global advertising
campaigns using the name of an event’s host city in the advertisements. In each
case, the brand does not hold the rights to promote or use trademarks of an event
but seeks to promote or use such trademarks for benefit. Abeza et al. (2021) note
that social media provides new opportunities for ambushing brands to undertake
creative marketing initiatives to establish associations with events.
As well as incursion, obtrusion and association (Burton & Chadwick, 2018),
other examples of ambush marketing can include:

introducing branded objects during coverage of or in proximity of a live

event
becoming a broadcast partner of a major event when a competitor has
purchased the naming rights, or purchasing advertising time during coverage
of the event
 referencing an event in advertising material, even while explicitly stating the
company is not a sponsor of the event
purchasing a lesser subcategory of sponsorship and leveraging that category
to create the appearance of major sponsorship without sponsoring the event
itself.

Ambush marketing is a problem for sponsors in that funds or services are

invested in an association with a sporting organisation from which non-investing
organisations can reap the benefits. Ambush marketing is a problem for sponsees
in that the effectiveness of the sponsorship will diminish and a prolonged
business relationship with the sponsor will be put in jeopardy.
More and more, sponsors are demanding that sponsees take precautions to
prevent ambush marketing. For example, Australian lawmakers have expanded
on the Trade Practices Act 1974 (TPA) protection with event-specific legislation
to ensure the rights of administrators and official sponsors were protected in the
2000 Sydney Olympics, the 2006 Melbourne Commonwealth Games and even
events like the Australian Football League (AFL) Grand Final. This legislation
prohibits inappropriate conduct in counterfeiting, aerial advertising, promotional
leaflet distribution within the vicinity of sports venues, advertising on boats, and
the illegal use of event insignias or logos.
Likewise, in serving the sponsor, sponsees are expected to increasingly
demonstrate a proactive stance in preparing for potential ‘ambushers’. A
proactive strategy can consist of the following actions:

identification of potential ambushers (these are often potential sponsors the

sporting organisation did not sign up)
identification of the commercial value of the sponsorship (which benefits the
sponsee can deliver, and how potential ambushers can obtain those benefits
without being involved as official sponsors)
detailed contracts (including exclusivity rights, detailed descriptions of what
is being considered as conflicting signage/advertising, sponsor/sponsee
obligations to prevent ambush marketing), and
joint sponsor–sponsee counteract strategies, which determine how sponsor
and sponsee will react in terms of PR, advertising (e.g., buying ‘strategic’
media time during potential ‘ambush timeslots’) or public appearances when
commenting on an ambusher’s actions.

This is a limited and certainly not complete list of actions to prevent ambushers
from taking advantage of a sponsorship relationship. Although ambush marketing
can never be eliminated, preparation can help sport marketers serve the sponsor to
the best of their ability. It needs to be noted that ambush marketing, in the context
of ‘ethics’ in sport marketing, increasingly is an activity that is viewed as
unethical. Consumers are increasingly aware of and sensitive to ‘corporate
abusive practices’, with ambushing being an obvious example.

Summary
This chapter showed the strategic importance of sponsorship and its measurement
for sport organisations. The market for sponsorship has undergone exponential
growth and continues to develop, with sponsorship dominated by sport and still
growing in popularity. This growth is generally attributed to the view that
sponsorship is a cost-effective way to achieve communication goals among large
and emotionally committed audiences. Further, sponsorship offers a wide range of
potential assets, and presents sport organisations or rights-holders with
developing opportunities to cultivate valuable digital rights and assets which,
while previously undervalued, can be attractive to potential partners.
There are various stages to the management of sponsorship, which can be
viewed in a cyclical or ongoing structure. For both sponsors and rights-holders or
sponsees, sponsorship can be used to satisfy a wide range of goals and objectives
– particularly media, marketing, corporate or sales goals for the sponsor, and
revenue- or fundraising-related goals for the sponsee. Effective use of leveraging
and implementing the sponsorship were presented, with best practice suggesting a
need for sponsors to support the association with the sport property through a
range of additional investments. A comprehensive set of sponsorship support
activities and tie-in promotions is required to optimise the sponsorship effort and
make the sponsorship as successful as possible in the overall marketing initiative.
The chapter offered a framework to demonstrate how sponsorship is said to
work. This allowed the presentation of differing effects that could be measured,
spanning cognitive, affective and behavioural (or sales-related) outcomes.
Measurement of effectiveness, while difficult, is an important component of the
management process. Ultimately, sponsorship effectiveness is a combination of
choosing a suitable sponsorship property, setting specific objectives and linking
these to the appropriate qualitative or quantitative effectiveness measures. In
order to further protect sponsorship rights, ambush marketing opportunities need
to be detected to prepare for potential ambushers taking advantage of a sponsor’s
rights.

CASE STUDY
Return on objectives: attracting and maintaining a major sponsor
Note: This case study (including all persons and organisations involved) is
purely fictional.
Frank Smith – a player at Nets District Basketball Club – had been at the
club for 12 years. In the lead-up to the 2021 season he was approached by club
president, Sandra O’Conner, to sit on the board as a communications and
sponsorship officer for the following season. Sandra explained to Frank, who
was a corporate expert in the field of marketing, the difficulties they were
having maintaining relationships with their sponsors.

For six of the nine years that I have been here we have been able to get
$5000–$10,000 from a local business; however, only SportsDrink Inc. –
our most recent sponsor – stayed with us for more than one season.
Nevertheless, at the end of last season they informed us that they would not
be continuing the sponsorship for the upcoming season. The relationships
are difficult to maintain. While the financial support from our sponsors is
vital for us as an organisation, our financial return on investment is not
very high for our sponsors. Therefore, while they enjoy being associated
with us, they often cannot justify the financial investment required to be a
major sponsor.

Frank nodded in understanding:

This seems to be a common problem with a lot of smaller organisations

that I have worked with. I would like the opportunity to broaden the
discussion from providing sponsors with a financial return on investment
toward return on objectives, building relationships and tailoring
sponsorship packages with local community partners.

Frank and Sandra agreed that this would be a good idea, and developed a
sponsorship strategy to present at the following week’s board meeting.

The suggested sponsorship strategy

At the next board meeting, Sandra introduced Frank: ‘I have known Frank for a
long time and believe he may be able to assist us with our ongoing sponsorship
battle.’
Frank began:
 Good evening everyone. I would like to discuss with you two things: our
sponsorship value proposition and our sponsor relationship strategy. I have
purposefully left the specifics of the proposal blank for us to fill in through
discussion, although I feel the below strategy may be beneficial in
attracting and maintaining long-term sponsors, which Sandra had indicated
has previously been difficult.
Previously our value proposition has been solely based on the loose idea
of return on investment, which can be difficult to measure for our sponsors,
and often not specifically the objective of the investment by the sponsor.
Colleagues of mine (Zinger & O’Reilly, 2010, p. 287) suggest that small
businesses will become involved in sport sponsorship for a number of
reasons, including:

community goodwill
public awareness of the firm
employee morale
brand image
product demonstration
entertainment of key clients
reaching new market segments
blocking competition, and
generating new sales.

Therefore, I propose that as a board we design our value proposition based

on offering a ‘return on objectives’ to our sponsors. If one of the objectives
is to incrementally increase sales through the sponsorship relationship, then
return on investment may be one measure. However, I believe this should
not be the sole focus of the value proposition.

Sponsorship proposal based on objectives

Frank continued: ‘Further, once we know what our sponsors want, we need to
construct a proposal that meets these objectives.’ He then detailed the main
aspects of his proposed new proposal, which included the following elements:

executive summary
organisation/event/athlete history and present situation – what is the
organisation about?
target audiences (for sponsor and sponsee) – who is the sponsor targeting?
sponsorship track record – what is the organisation’s sponsorship history?
 period of association for the proposed sponsorship – how long? Are there
extension options?
benefits on offer – what does the sponsor get out of the relationship?
benefit valuation (capitalisation) – how much will the sponsor need to
invest?
packages – what is the total offer?
sponsorship-activation activities – are there any publicity, advertising or
marketing activities?
ambush-prevention strategy – how is the organisation ensuring exclusivity?
effectiveness measurement – what are the measures of effectiveness?

Questions
1. Given your knowledge of sponsorship after reading this chapter, can you
detect any information explaining why the previous sponsor decided to
cease the agreement? What else do you think would make it difficult for
local sport clubs to attract sponsors?
2. Given your knowledge of sponsorship situations, how could these
relationships have been improved?
3. Why do you think ‘return on objectives’ is a common term in sports
sponsorship?
4. Consider the context of a local sports club you are familiar with.
Contribute examples in the context of your organisation for every heading
in Frank’s draft proposal.

References
Abeza, G., Braunstein-Minkove, J.R., Séguin, B., O’Reilly, N., Kim, A., &
Abdourazakou, Y. (2021). Ambush marketing via social media: The case of
the three most recent Olympic Games. International Journal of Sport
Communication, 14(2), 255–279.
Anderson, J. (2020, August 23). The highest-paid athlete of every year from
1990 to 2020. Yahoo! Finance. https://finance.yahoo.com/news/highest-paid-
athlete-every-1990-090000092.html.
Arthur, R., Scott, D., Woods, T., & Booker, R. (1998). Sport sponsorship
should … A process model for the effective implementation and
management of sport sponsorship programmes. Sport Marketing Quarterly,
7(4), 49–60.
Badenhausen, K. (2020a, May 29). Roger Federer tops world’s highest-paid
athletes: Tennis ace scores first no. 1 payday with $106 million. Forbes.
https://www.forbes.com/sites/kurtbadenhausen/2020/05/29/roger-federer-on-
top-the-swiss-tennis-ace-scores-first-no-1-payday-with-106-million/?
sh=5a1ce86618d9.
Badenhausen, K. (2020b, August 17). Highest-paid female athletes 2020: 50
years after creation of women’s tour, tennis dominates earnings list. Forbes.
https://www.forbes.com/sites/kurtbadenhausen/2020/08/17/the-highest-paid-
female-athletes-2020-center-court-takes-center-stage/?sh=3ee79d945eb6.
Belch, G., & Belch, M. (2018). Advertising and promotion: An integrated
marketing communications perspective (11th edn). McGraw-Hill Education,
New York.
Breuer, C., & Rumpf, C. (2012). The viewer’s reception and processing of
sponsorship information in sport telecasts. Journal of Sport Management,
26(6), 521–531.
Burton, N., & Chadwick, S. (2018). Ambush marketing is dead, long live
ambush marketing: A redefinition and typology of an increasingly prevalent
phenomenon. Journal of Advertising Research, 58(3), 282–296.
Chadwick, S., & Thwaites, D. (2004). Advances in the management of sport
sponsorship: Fact or fiction? Evidence from English professional soccer.
Journal of General Management, 30(1), 39–60.
Chadwick, S., & Thwaites, D. (2005). Managing sport sponsorship
programs: Lessons from a critical assessment of English soccer. Journal of
Advertising Research, 45(3), 328–338.
Chadwick, S., Lui, R., & Thwaites, D. (2014). Ambush marketing and the
football World Cup. In Frawley S. & Adair D. (eds), Managing the football
World Cup. Palgrave Macmillan, London.
Cornwell, B. (1995). Sponsorship-linked marketing development. Sport
Marketing Quarterly, 4(4), 13–23.
Dentsu. (2021, January 27). Global ad spend forecasts 2021.
https://www.dentsu.com/us/en/reports/global_ad_spend_forecasts_2021_pdf.
Greenroom Digital. (2021, April 14). Can rights holders really afford to
leave millions on the table in missed digital revenue?
https://greenroom.digital/news/can-rights-holders-really-afford-to-leave-
millions-on-the-table-in-missed-digital-revenue/.
Guttman, A. (2019, November 26). Spending on sponsorships worldwide by
region 2009–2018. Statista.
https://www.statista.com/statistics/196898/global-sponsorship-spending-by-
region-since-2009/.
Hansen, F., & Scotwin, L. (1995). An experimental enquiry into
sponsorship: What effects can be measured?In Seminar on Advertising,
sponsorship, and promotions: Understanding and measuring the
effectiveness of commercial communication: Madrid (Spain), 15th–17th
March. ESOMAR, Amsterdam, 65–82.
IEG (2020). IEG outlook 2020: Forecasting the future of the sponsorship
industry. https://www.sponsorship.com/Latest-Thinking/Sponsorship-
Infographics/IEG-Outlook-2020--Forecasting-the-Future-of-the.aspx.
Irwin, R.L., & Asimakopoulos, M.K. (1992). An approach to the evaluation
and selection of sport sponsorship proposals. Sport Marketing Quarterly,
1(2), 43–51.
Jones, D. (ed.). (2021). Football money league: Testing times. Deloitte,
London.
Karg, A. (2007). Sport Sponsorship management: Practices in objective
setting and measurement. Deakin University.
McDonald, H., & Karg, A. (2015). Quantifying the positive effects of
sponsor level, length, prominence and relatedness on recall and residual
recall rates over time. Journal of Marketing Communications, 21(5), 372–
391.
Meenaghan, J.A. (1983). Commercial sponsorship. European Journal of
Marketing, 17(7), 5–73.
Meenaghan, T. (1991). The role of sponsorship in the marketing
communication mix. International Journal of Advertising, 10(1), 35–47.
Newcomb, T. (2019, April 4). Naomi Osaka switches course, inks Nike
endorsement deal. Forbes.
https://www.forbes.com/sites/timnewcomb/2019/04/04/naomi-osaka-
switches-course-inks-nike-endorsement-deal/?sh=76d0e527da29.
Nielsen Sports. (2021, February 16). The changing value of sponsorship:
2021 global sports marketing trends. https://nielsensports.com/the-changing-
value-of-sponsorship/.
Owen, D. (2021, March 10). IOC international sponsorship programme set
to raise record $3 billion in 2021–2024 cycle. Inside the Games.
https://www.insidethegames.biz/articles/1105244/bach-update-on-top-
sponsors-programme.
Rowe, K., Karg, A., & Sherry, E. (2019). Community-oriented practice:
Examining corporate social responsibility and development activities in
professional sport. Sport Management Review, 22(3), 363–378.
Séguin, B. (2008). ‘Sponsorship in the trenches’: Case study evidence of its
legitimate place in the promotional mix. The Sport Journal, 10(1), 1–11.
Seitanidi, M.M., & Ryan, A. (2007). A critical review of forms of corporate
community involvement: From philanthropy to partnerships. International
Journal of Nonprofit and Voluntary Sector Marketing, 12(3), 247–266.
Speed, R., & Thompson, P. (2000). Determinants of sports sponsorship
response. Journal of the Academy of Marketing Science, 28(2), 226–238.
Stephan, P. (2019, May 2). Data, digital and sponsorship’s future.
https://twocircles.com/gb-en/articles/digital-data-and-sponsorships-future/.
Zaharia, N., Bascaia, R., Gray, D., & Stotlar, D. (2016). No more ‘good’
intentions: Purchase behaviors in sponsorship. Journal of Sport
Management, 30(2), 162–175. doi:10.1123/jsm.2015–0347.
Zenith. (2018, May 29). Media consumption forecasts 2018.
https://www.zenithmedia.com/product/media-consumption-forecasts-2018/.
Zinger, J.T., & O’Reilly, N.J. (2010). An examination of sports sponsorship
from a small business perspective. International Journal of Sports Marketing
& Sponsorship, 11(4), 14–32.
Part IV
Measuring and managing sport
marketing strategy

DOI: 10.4324/9781003270522-15

CHAPTER 12
Implementation, ethics and future trends in sport marketing
CHAPTER 12

Implementation, ethics and future

trends in sport marketing

DOI: 10.4324/9781003270522-16

Chapter objectives
Chapter 12 revisits some important concepts introduced throughout this book
and how they are operationalised. It does so by reviewing the role of the control
function in coordinating and implementing the selected marketing strategies vis-à-
vis feeding forward, concurrent and feedback activities and performance
outcomes of sport marketing strategies. The role of the modern sport marketer is
also discussed in the context of different types of sport organisational models.
Sections discussing sport marketing structures, ethics in sport marketing and sport
marketing trends and their impact on the strategic sport marketing process are
included to provide a source of reflection on the current and future role of sort
marketing.
After reading this chapter, you should be able to:

understand the importance of control in the marketing function, including

three types of control
comprehend the relationship between measures of success and the control
process
recognise the importance of coordinating and implementing marketing
strategies
comprehend the scope of the sport marketing function
understand the relationship between a sport marketer and others within a
sport organisation hierarchy
identify possible ethical concerns that sport marketers might encounter
comprehend how future trends will impact how sport marketing strategies
are developed, implemented and managed.

Headline story
RBI: relationships batted in
The Toronto Blue Jays are no strangers to their commitment to grassroots baseball
in Canada and, specifically, Southern Ontario, one of the most populous regions
in the country. Their corporate social responsibility arm, the Jays Care Foundation
(JCF), has existed for more than two decades, providing important investments in
infrastructure and sport programming. In 2020, the JCF contributed C$7.5 million
to various initiatives, including more virtual programming to maximise their
engagement with more young people across the country.
However, the Jays have also focused attention on urban youth through their
Reviving Baseball in Inner Cities (RBI) programme. This development
programme works with inner-city schools in key underserved areas like the
Greater Toronto Area (located in Southern Ontario) to develop important team-
building skills for life, as well as a passion for the sport of baseball. Once a school
signs up to the programme, the JCF provides trained coaches, equipment, and
replica uniforms so that youth are able to participate in a structured, organised
format and feel like professional athletes playing for the Toronto Blue Jays. RBI
games are also filled with various other activities, music and engagement to create
 a holistic setting of fun. Moreover, youth from Toronto can also attend Blue Jays
games at a discounted rate and enjoy special experiences (e.g., meet a player).
What makes this unique is that the demographic composition of RBI programmes
is more varied, representing both previous waves of immigration (e.g., Black, East
Asian) and new waves (e.g., Middle Eastern, South Asian) to urban Canadian
centres. Through the RBI programme, a large majority of the underserved youth
feel more confident in themselves and, more importantly, want to continue
playing and following baseball (Jays Care Foundation, 2019).
The RBI programme is a critical extension of the Blue Jays’ marketing plans.
Certainly, there is an important social impact created by this type of
programming, providing important life-skills through teamwork and organisation;
but the relationships being cultivated and fostered here are also important for the
organisation to develop and maintain as they seek the next generation of fans. As
Canada and many other advanced economies experience shifts in their
demographic landscape, especially in urban settings, it is important to maintain
relevance in the market and forge new relationships that can reveal a new pipeline
for growth and sustained success.
The Jays’ need to engage the community brings us to the last theme of this
book: managing marketing strategies. Thus far, the book has considered the
marketing mix and all the variables the sport marketer can manipulate to ensure
that a sport is able to identify and sustain a competitive advantage. The Jays’
decision to strengthen their commitment to grassroots baseball in underserved
urban communities is an example of combining marketing mix variables to form a
marketing strategy. How these strategies are implemented is part of the
management aspect of marketing.

This chapter begins by reviewing the range of functions necessary to implement

marketing strategies. It examines some of the control mechanisms available to the
marketer to ensure that performance targets are met, and considers some of the
more relevant measures used to gauge success in sport. Inherent in these measures
is the question of design and its contribution to the marketing process. However, in
the modern sport management landscape, it is also important for sport marketers to
recognise how their ability to control and manage marketing strategies is impacted
by the structures and roles that exist in the workplace. Consequently, this chapter
will look at various integrations of the marketing function within sport, including
examples from amateur, collegiate and professional levels. Finally, the chapter
discusses another important feature of managing marketing strategy in the modern
era: ethics. It is becoming ever more important for sport marketers to appreciate the
ethical considerations of the marketing mix and measurement, and thus they should
be embraced as a key aspect of control within sport marketing. Other strategic
trends which will impact the sport marketing mix in the near future are also
introduced in the final section of this book.

Controlling the sport marketing function

Mullin and Walker (2009) noted that the control process consists of ‘setting
performance standards, specifying feedback, obtaining data, evaluating it, and
taking corrective action’ (p. 499). Setting performance standards is an important
part of the marketing planning process. Marketing objectives established during this
process will have identified the standards to be achieved, notably those that are
SMART: specific, measurable, attainable, relevant and timebound.
For sport organisations, these objectives and performance standards differ from
those of organisations in other sectors. Take major retailers or financial services
firms, which are primarily concerned with profit and providing dividends to
shareholders. Their performance standards are therefore aligned accordingly.
Conversely, sport organisations are unique in that their focus is not always simply
maximising profits, though it can be the case for some professional sport operations
depending on the political and economic context (e.g., Manchester United, Juventus
FC). Nevertheless, for the vast majority of sport organisations objectives are mixed,
incorporating financial, governance, participatory and social objectives. For
example, in a dispute between the Australian Rugby League (ARL), the earlier
incarnation of the National Rugby League, and the Australian Super League the
judge noted that the former’s board was ‘motivated in large part by considerations
other than the pursuit of profit. It is concerned with the preservation and
enhancement of the traditions of the game’ (Burchett, 1996, p. 65). Recognition of
these broader considerations does not lessen the importance of sport marketing. In
fact, the reality is quite the opposite.
Today, there is an increased focus on the marketing function to generate revenue,
a critical resource necessary for sport organisations at the club, association or
league level to operate and deliver for their members, fans and athletes. With
greater cash reserves, sport organisations can develop greater human resource
capacity to sustain and enhance their operations. For this reason, financial resources
are often desired by managers within sport organisations to sustain operations,
especially at the non-profit, club level. The challenge, however, is a lack of
performance standards and controls implemented at these levels (Misener &
Doherty, 2009). Even at higher levels of sport, such as North American professional
ranks, this remains an issue and puts even greater importance on the marketing
function within the sport organisation to ‘get it right’ – including establishing a
strategic vision and set of SMART objectives, and incorporating elements of the
marketing mix. However, it is also critical to establish and benchmark performance
standards to ensure the marketing programme is on the right track and can achieve
the results the sport organisation seeks. To do so, sport marketers might need to
enact one or more of three types of organisational control:

feed-forward
concurrent, and
feedback.

Feed-forward control
This takes place before production and operations begin, and commences at the
early stages of the strategic sport-marketing planning process (SSMPP).
Determining the operating procedures and setting standards for the operation of a
facility prior to a season commencing is an example of feed-forward control. As
part of this review of operational procedures, appropriate staff training will be
provided consistent with service quality policies. For instance, the sport
organisation may want staff to wear a uniform on game-days to maintain brand
standards and emphasise the promotional mix for certain activities. This form of
control ensures brand consistency, and all inputs are of the highest quality for
optimum spectator enjoyment.

Concurrent control
Concurrent control occurs during sport – in other words, while the plans are being
carried out. Often, the context of concurrent control will be a major sport event or
the weekly games in a given season. In the sport facility, monitoring the quality of
service delivery exemplifies concurrent control. Supervisors will be responsible for
checking that staff carry out their jobs in a manner consistent with the
organisation’s policies. In some cases, it is possible to fine-tune the activity as it
occurs or to rectify problems immediately, which are other examples of concurrent
control in practice. For instance, imagine signage at a sport facility is subject to
inclement weather, jeopardising the relationship between the sport property and
advertising brand. With concurrent controls, the sport organisation can have
consistent checks throughout the match to ensure the signage is not distorted and
remains fully intact for maximum visibility by spectators and the television
audience. Additionally, concurrent control can occur when monitoring attendances.
If these are lower than expected, same-day advertising may need to be intensified or
altered, or sales promotions implemented, to return the organisation to a satisfactory
level of performance. Determining acceptable levels of performance requires the
identification of appropriate measures during the SSMPP.

Feedback control
Feedback control focuses on the final performance measured against previously
ordained standards or targets. The sport marketer looks at the final result post-event
and, upon review, determines whether change or modification is necessary to ensure
that the intended, defined performance standards can be achieved at the next game,
event or even season. For example, if at the end of the Major League Baseball
(MLB) season a sport marketer for the Los Angeles Dodgers was not happy with
attendance figures at Dodger Stadium, then feedback could be used to refine their
marketing scheme and overall SSMPP in the off-season for the following season.
This type of post hoc reflection is important for sport marketing as not all controls
can be pre-planned, proactively determined or changed in real time; sometimes it is
best for the sport marketer and his/her organisation to let the situation unfold in its
entirety, without change, and allow for refinement thereafter. By doing so, sport
marketers are able to conceptualise sport events, games and seasons as whole units
instead of making ad hoc changes that are more difficult to pinpoint and ascertain
for their failure to meet the performance standards sought. Figure 12.1 displays the
link between the stages of the control process and the measures typically used to
ascertain success in a sporting organisation.

Figure 12.1 The control process and measures of success

Key performance indicators

On-field success is typically the most obvious and visible measure of success by
which to assess the performance of sporting organisations. It is, however, an area
over which the sport marketer has little control. Unlike most products where the
marketer has some input into design, the sport marketer has no control over the
selection and quality of the team. So, it would be unreasonable to assess and judge
a sport marketer’s performance based upon the on-field success of the team.
However, sport marketers are tasked with promoting sport entities based on quality,
characteristics and even star athletes. This can be a difficult task as not every team
is going to be successful, or even have star-calibre athletes on its roster. So, if on-
field success is the measure of success by which the organisation is assessed, how
are sport marketers judged? Although on-field performance is an organisation-wide
measure, it is not the performance benchmarks that are of concern for sport
marketers. Instead, increases in attendance and/or participation, season ticket holder
or membership rates, sponsorships, broadcasting and digital media figures,
merchandise and licensing deals, service quality and the overall financial stability
of the organisation are some of the pertinent key performance indicators (KPIs)
where sport marketing staff are judged on the success of their strategies.

Attendance and participation

Attendance and participation are two key measures of sport marketing performance.
They are linked as elite athletes serve as role models for those participating at lower
levels of sporting competition. The ‘Beckham effect’ is one example of this
relationship. This refers to the impact that former global footballer David Beckham
had on attendance rates for Major League Soccer (MLS) in North America (Shapiro
et al., 2017). Through the attendance spikes and, consequently, the general interest
in global football there have been rising numbers of participants in Canada and the
United States trying to ‘bend it like Beckham’. However what is unique about the
Beckham effect (and similar examples in other sports, such as the Tiger Woods
factor in golf) is that increased participation will eventually contribute to future
growth in attendance as affinity for the sport is sustained over time. In essence,
because of attending a game, an individual is likely to want to play the sport, and
through their participation they gain an appreciation for the sport and want to watch
it – whether live, on television or via interactive methods on digital and social
media.
Thus, sport organisations are certainly concerned with boosting the numbers of
registered participants. Strategies designed to stimulate and promote the growth of
participation have become topical for sport marketers, and include introducing new
competitions or modified rules and formats for youth, women and girls, new
immigrants and para-athletes. This strategy has been specifically designed to attract
traditionally underserved communities and groups to play sport. Irrespective of the
context, these new competitions, modified rules or altered formats become an
integral part of the marketing strategy as sport organisations strive to capture a
finite number of participants. For many local, state or territorial and national sport
organisations (NSOs), registration numbers are a critical measurement of success
(and are often used by government bodies to allocate funding and resources), and
can also serve as a proxy for success of the marketing programmes enacted within
the organisation.

Club membership
Club membership, too, is an important measure. As discussed in Chapter 10, the
satisfaction of season ticket holders or club members is important as these
individuals represent consistent attendance and associated consumption behaviours
(e.g., purchasing concessions, merchandise), equating to a significant source of
revenue for the sport organisation. What makes these groups even more important
as a measure of success is that the revenue generated from season ticket and
membership sales often derives from a period in the off-season when no games
taking place. This is a critical point as when matches are being played the sport
organisation can generate weekly income through ad hoc (i.e., one-off) ticket sales,
sponsorships and local media broadcast rights. However, this is not the case in the
off-season. Thus, to ensure the financial viability of the sport organisation during
those ‘lull’ periods in a calendar year, marketing programmes should be designed to
reward longevity and minimise defection or cancellation of season ticket
holder/membership status.

Sponsorship
Sponsorship is another key measure of success in the marketing programme, for
large, global teams as well as for small or local sport organisations and clubs. In
fact, sponsorship has been considered so important that many sports have
developed unidimensional marketing programmes aimed at attracting sponsorship
revenue. In the long term, this myopic view is detrimental to the sporting
organisation for two reasons:

It negates the extent to which the sporting organisation can devise a full range
of marketing-related benefits that can be provided to the sponsor.
It concentrates the success of the marketing programme on one objective.

Concentration on any one objective is a potentially poor strategy. Sporting

organisations need to diversify their range of marketing strategies to prevent over-
reliance on any one area. For example, if sponsorship income falls well below
anticipated projections, the overall success of the organisation will be threatened
because no effort has been made to raise revenue by ensuring attendance, attracting
members and selling merchandise.

Broadcasting and digital media

The importance of broadcasting to the sport marketing effort was also stressed
earlier in Chapter 8. Media distribution, in particular, has the capacity to provide a
significant stream of revenue as well as acting as an important promotion vehicle
for sports – even if no television revenue is forthcoming. For instance, prior to
2011, major US broadcaster NBC did not pay any rights fees to televise National
Hockey League (NHL) games, instead maintaining a revenue-sharing arrangement
with the league (Yerdon, 2011). While the arrangement did not generate significant
amounts of revenue for the league, it helped promote the sport to the ever-important
US market, stimulating much interest in the product and eventually allowing the
NHL to secure billions of dollars in broadcast rights fees.
However, sport marketers must carefully determine the role of television in their
marketing plans. Questions to be answered in relation to setting marketing
objectives include: Is the sport capable of attracting television rights revenue? If so,
how much? If not, how can some coverage be obtained to help promote the sport?
Answers to these questions determine the marketing objectives set in relation to
television, and thus the measures used to assess performance. Chapter 8 outlined
the range of measures used to assess the effectiveness of sport programming and the
subsequent advertising revenue that these programmes can attract. Successful sport
marketers need to know how the television business operates to ensure that those
revenues or promotions are successfully implemented in the overall marketing
strategy.
With the emergence of new, advancing technologies, digital media represents
another pathway of which sport marketing managers should be cognisant. As with
anything new and evolving, there are challenges for sport marketers in how they
strategise, plan and manage or control operations. For instance, sport marketers
have reported difficulties in developing a presence for their organisation across the
suite of salient social media platforms (Naraine & Parent, 2017). Moreover, digital
media concepts can be difficult for some sport marketers to fully grasp and
comprehend (e.g., influencers, search engine optimisation, virality and trends),
especially given their relative newness in the sport management landscape. Thus, it
is important for sport marketers to not take a sporadic approach to digital media
such as social media platforms, apps and extended reality – i.e., virtual reality (VR)
and augmented reality (AR) – and begin to unpack the nuances and intricacies of
sport consumers’ digital behaviours. One example of this is the recent
developments about the segments that exist within digital sport organisation
networks (Naraine, 2019a), and when digital fans are most active (Naraine et al.,
2019). Additionally, sport marketers must be cognisant of what types of digital
media are on the horizon. Today, new trends are emerging in the sport industry,
such as blockchain (Naraine, 2019b) and artificial intelligence (Naraine & Wanless,
2020), while 3G/4G networks have been supplanted by 5G (with 6G in the works)
and Wi-Fi connectivity throughout major sport facilities (Naraine et al., 2020).
Thus, as sport organisations seek to maintain relevance with their consumers as a
proxy for success, it is critical to embrace digital media, harnessing its breadth of
capabilities and not shying away from its sophistication and potential impact on the
sport organisation’s operations.

Merchandising and licensing

Merchandising and licensing are also important marketing objectives. Promotional
licensing was the subject of Chapter 9, where it was shown that sporting
organisations license their logos and trademarks for two reasons:

to create awareness of the sport, club or league, and

to endorse product lines outside of sport as a means of generating additional
revenue.

Revenue from licensing income becomes the main measure in determining the
success of such a programme. Clearly, this revenue can easily be measured, and can
be utilised to demonstrate success (or lack thereof) for a sport organisation.

Service quality
Another important, though less tangible, measure is service quality, which was
developed and specifically discussed in Chapter 10 as providing the basis for
establishing a competitive advantage. It also indirectly affects everything that is
concerned with attracting spectators, members and sponsors, contributing to the
likelihood of repeat purchase. Strategically, it is significant because it has the
capacity to even out the fluctuations in enjoyment governed by winning or losing.
An enjoyable night out at a basketball game, for example, may to some extent
offset the disappointment of losing.
This raises the critical question, in relation to this intangible area, of assessing
how much participants and spectators enjoy the sport experience. Equally, this
question relates to winning. Sport clubs, associations and leagues are increasingly
realising that their marketing programmes should be designed to build loyalty –
loyalty that has the capacity to withstand periods of poor on-field performance. The
reality of most sporting competitions is that it is in their own interest to ensure that
winning is shared by all, and therefore mechanisms will be put in place to even out
the competition – also known as ‘competitive balance’. Clubs will experience
periods during which they are successful and those when they perform poorly.
Success on the field does not guarantee success off the field; but poor on-field
performance almost certainly guarantees poor off-field results based on the
measures discussed above. Reducing the impact of these periods of poor on-field
performance enhances the likelihood of achieving financial stability.

Financial stability
Despite an earlier statement in this chapter that profit is not the sole goal of sporting
organisations, it has grown in importance over the past 30 years. Many sporting
organisations once typified the extreme position, where debt could be freely
incurred without considering the consequences. Fortunately, this culture is
changing, reinforcing the importance of control in the implementation of marketing
activities. Modern sporting organisations now more readily understand the balance
between on-field success and sound off-field success.
Most of the measures of success discussed in this section contribute to the
income-generating potential of the organisation. The ability to rein in costs is the
subject of broader texts in the management domain, covering the issue of control in
more detail.

Coordinating and implementing marketing strategy

The framework for determining a sport marketing strategy was discussed
previously in Chapter 2 (i.e., SSMPP), and the coordination and implementation of
the developed strategy are critically important. It is not simply enough to develop a
plan and discuss how it works; rather, it must also be operationalised, a key
responsibility of the marketing department. Marketing implementation is the
process that turns marketing strategies and plans into actions in order to fulfil
strategic marketing objectives. Coordination cannot occur, however, without the
support of the entire organisation. Marketing staff are often reliant, for example, on
operational staff to allow star players to become involved in promotional activities.
Typically, these star players are in high demand for such activities, which often
conflict with training and playing schedules.
Implementation is primarily about staff management, and in essence deals with
the who, what, where and when of the marketing plan. These activities are the result
of the strategies determined. Implementation can be difficult – more difficult than
determining the strategies. It is easy to dream up a range of interesting and creative
strategies; however, when it comes to actual implementation, it may be found that
they are unrealistic or impractical. When setting SMART objectives, as discussed in
Chapter 2, the ‘R’ for realistic is of paramount importance. Ultimately, it is the staff
and their expertise that determine the ability of the organisation to coordinate the
marketing strategy.

Sport marketing departments and positions

Adding to the difficulties of coordinating and implementing marketing strategies
are the hierarchical complexities introduced and embedded within sporting
organisations. For some organisations, marketing programmes might be within the
purview of just one person, such as the sport development officer who is tasked
with promoting and encouraging participation. In other instances there may be
specialist marketing staff across a range of areas, including events, social media,
branding, licensing and sponsorship. Indeed, marketing is one of the growing
aspects of the sport industry, with considerable and diverse career opportunities.
However, while career growth exists in the sport marketing space, it is equally as
important to highlight how modern sport marketing departments ‘look’ to reveal
opportunities for collaboration as well as the power dynamics that might add to the
challenge of coordinating and implementing the marketing strategy.
First, consider organisations at the amateur sport level. Typically, these are clubs
at the local or national level that are the custodial bodies for their respective sport,
or simply serve as a hub for a given sport in the community. Traditionally, these
organisations have been hyper-focused on participation, predicated on the belief
that their long-term survival depended largely on participation and membership
fees. Consequently, these sport organisations were not as focused on merchandise
and licensing, broadcasting and digital media, or even service quality to a lesser
extent, and their organisational hierarchy was established to focus on and around
participation. For example, Softball Australia, a traditional NSO, has limited
growth from a marketing perspective, listing only one explicit marketing-related job
within the organisation: communications and marketing manager. Indeed, its focus
has been more on elite athlete development and community sport, and less on the
marketing function. By contrast, another NSO, Swimming Australia, has started to
embrace more marketing, sponsorship and corporate service roles, in addition to the
standard functional areas like finance, facilities and events. One reason for this shift
has been the recognition that these marketing roles can help generate revenue to
promote the sport and achieve the elite performance and mass participation
benchmarks thereafter. However, another reason has been external pressures in the
marketplace, mostly through government legislation and stakeholder expectations
that have forced many NSOs to adopt a more corporate, professional approach to
their operations (Parent et al., 2018). Consequently, several amateur sport entities at
the national level have begun to open up more roles and expand their marketing
departments.
SPORTVIEW 12.1
U SPORTS
In Canada, one NSO that has reorganised its organisational hierarchy to expand
the marketing function is U SPORTS, the national governing body for
intercollegiate sports. Similar to UniSport in Australia, British Universities &
Colleges Sport (BUCS) in the UK or the National Collegiate Athletic Association
(NCAA) in the United States, U SPORTS has a storied history in Canada. Its
original iteration, the Canadian Interuniversity Athletic Union, dates back to
1906. Over the years the organisation grew as more university members joined,
and their primary revenue stream, government funding, increased. Its growth
culminated in 2016 with a radical transformation, impacting everything from the
organisation’s name, office headquarters location and governance to its staff
structure (Thompson & Parent, 2021). The result has been a highly corporatised
look and feel, emphasised by the increased focus on the marketing function.
As Figure 12.2 shows, U SPORT’s modern organisational structure emphasises
the strategic marketing function through two high-level positions: Senior Manager
of Marketing, Brand and Communications, and Chief Commercial Officer. In the
case of the former, the senior manager has oversight over three important areas to
ensure brand consistency and service quality. However, this also highlights the
capacity constraints that remain for NSOs in the modern era, as professional sport
entities might have a senior manager for each of those three areas (i.e., marketing
communications, branding and event marketing/promotions). In the case of the
Chief Commercial Officer, this executive’s sole responsibility is to cultivate new
partnerships and maintain positive relationships with sponsors, while the manager
of corporate sponsorships, the position that reports to the Chief Commercial
Officer, is tasked with servicing, activation and ambush prevention (through
education). Nevertheless, what the U SPORTS example reveals is how the
marketing function in many amateur sport organisations has begun to splinter into
more specific, intricate roles at the entry and middle-manager levels. But, this
evolution is not always possible. Some amateur sport organisations remain small
and/or maintain limited capacity to grow, especially at the local and regional
levels. However, there are exceptions, and shifts towards this more corporate,
marketing-focused approach have become more frequent over the last half
decade.
 Figure 12.2 U SPORTS organisational flow chart Source: Adjusted
from U SPORTS (2021).

Unsurprisingly, professional sport has offered the greatest range of career options in
sport marketing; and, with the continued focus on increasing revenues, the number
of roles and positions has multiplied markedly over the last 30 years. For example,
Collingwood Football Club, one of the largest professional sport organisations in
Australia, typically employed over 20 staff (in the pre-COVID-19 era) to run its
commercial operations; this includes staff responsible for digital media, commercial
partnerships, membership and merchandise, sales and media/public relations. These
staff members are responsible for the implementation and coordination of all the
club’s various marketing activities (big and small), all of which are covered through
the marketing mix variables discussed in this book.
The Collingwood example is just one of many Australian professional sport
clubs; but it is not representative of the widespread growth of the marketing
function in other, more global sport entities. The variance in sport marketing roles
can be discovered through the case of teams in the National Basketball Association
(NBA), for example. As a collective, teams in the NBA employ an average of 31
staff for marketing functions, 19 of which are focused on digital media content.
There has also been a rise in the number of speciality marketing positions in the
league. In 2019, the top three in-demand roles for NBA teams were in the areas of
digital marketing, creative services, and marketing research and analytics. In this
context, digital marketing could range from website and digital advertising to email
marketing and social media promotion; creative services would involve creating
engaging, producing stunning visuals for use in content pieces, promotional
campaigns or other team communications (e.g., brochures, sponsorship proposals);
and marketing research and analytics would involve roles that dive deeper into fan
demographic and behavioural data, websites, apps and social media metrics, and
analysing customer relationship management databases.
An overview of the NBA landscape reveals the differences between professional
sports in different markets, as well as team-to-team variations in how sport
marketing structures function in practice. For example, the Portland Trail Blazers, a
small-market team by media market standards, employ just 27 staff members for
sport marketing roles within the organisation – fewer than the league average. The
team has some unique sport marketing roles, particularly at senior levels, including
Manager, Digital Marketing, Director, Creative Services and Senior Strategy
Analyst. Teams like the Toronto Raptors operate in a larger market and from a
structural perspective are ‘medium-sized’, employing 55 staff members across the
sport marketing function. However, this team is unique in that it is part of a much
larger professional sport portfolio. The umbrella sport organisation, Maple Leaf
Sports & Entertainment (MLSE), owns and operates the Raptors in addition to
other professional teams, including the Toronto Maple Leafs, Toronto FC, Raptors
905, the Toronto Argonauts and the Toronto Marlies. To maximise efficiencies,
MLSE has created three working groups known as Team Blue (overseeing the
Leafs, Marlies and Argonauts), Team Red (overseeing the Raptors, Raptors 905 and
Toronto FC) and Team Noir (overseeing their community foundation, retail
operations, food and beverage and other special projects). Naturally, this structure
breeds some unique sport marketing roles within the senior ranks at MLSE. With
more umbrella organisations in sport and entertainment popping up in North
America, Europe and Asia, it is vital that the next generation of sport marketer
recognise that their responsibility might be spread across multiple franchises
simultaneously.
Larger still is the case of the NBA’s Miami Heat, a team in a major market by
media broadcast standards as well as organisational depth. The franchise employs
79 sport marketing staff across three major sub-departments: (1) creative and
digital; (2) retail, broadcasting and corporate social responsibility; and (3)
traditional marketing. Per previous chapters, the team provides strong examples of
modern sport marketing positions in professional sport. For instance, the Vice
President, Creative and Digital Marketing oversees all branding and creative
campaigns, including uniform design; unifying social, web and app messaging; and
ensuring a streamlined design for the team’s ‘brand culture’. Meanwhile the
Director, Digital Content is more focused on partnerships, ensuring the successful
execution of agreed key performance indicators, selling team-branded content
across digital media and liaising with third-party sport marketing agencies. There is
also a Senior Director of Interactive Marketing, who oversees automation, e-
commerce and esports/video gaming through the NBA’s licence with the NBA 2K
series. This role is particularly interesting given it oversees the team’s presence in
China, an important market for sport organisations (like Miami Heat) seeking to
grow their presence on a global scale.
In sum, at the professional ranks, sport marketing has evolved to have significant
variance in the number of staff, the types of roles and the overall focus of the
department and its sub-departments. In particular, professional sport has evolved to
accept digital advancements (e.g., social, web, apps), as well as the need to be more
creative and streamlined across brands. At the amateur sport level, organisations are
also incorporating an increased focus on sport marketing. Thus, the complacency
that existed at the turn of the 21st century, fraught with a slow pace of change, has
been shifting in a positive direction, indicating that sport marketing is important
and growing.
Interestingly, the pace of change has become more urgent as sporting
organisations realise the capacity of a skilled marketing team’s potential to
contribute to the full range of revenue-earning possibilities via marketing
programmes. It is true that, in some instances, it is necessary to spend money up
front to ensure that revenue-earning potential is maximised. Advertising, public
relations launches and staff training in terms of service delivery are examples of
this sentiment. However, they are also the means of communicating with a public
that is increasingly subject to an attractive range of recreation and leisure pursuits
capable of detracting from interest in sport. The past 30 years in particular have
seen a rapidly intensifying range of competitive forces within the recreation and
leisure industry. In many ways, this has been a positive indicator as sports have
been forced to professionalise their operations and modernise the way they deliver
the overall sport package.

Sport marketing ethics

With the growing recognition of the importance of the marketing function, and the
corresponding expansion of roles and pathways within the sport organisation, it is
also important to highlight ethical considerations. As the recognition of marketing
has grown within sport, so too has the notion of extending partnerships or even
engaging in brand extensions in debatable categories. For instance, fast-food
restaurant chains have long advertised their products via sport for extended periods,
hoping to entice consumers through their association with fit, muscular, athletic
bodies. In Australia, McDonald’s has been the official restaurant of the Australian
Football League since 2015, and extended their partnership in 2018 to incorporate
the new women’s division. In both capacities, McDonald’s is hoping to curry favour
among supporters of the professional men’s and women’s sport product who, in
turn, would look to support the restaurant when seeking a low-cost meal option.
However, this is a critical ethical consideration a sport marketer needs to reflect
upon. Fast-food or ‘quick-service’ chains are nearly synonymous with various sport
products at this juncture, so it makes sense for McDonald’s competition like
Hungry Jacks and KFC to follow suit, with both sponsoring sport in the same
market – NBL basketball for the former, Big Bash League (cricket) for the latter.
But, sport marketers must weigh up the challenges with this revenue-generation
opportunity as, for one, fast-food choices might contribute to increased obesity rates
and impede sport consumption (e.g., participation) through these unhealthy habits.
In this capacity, the sport organisation appears to send mixed, contradictory
messages to its audience about the importance of sport as a means of physical
activity and healthy active living by embracing these fast-food chains. Yet, fast food
is just one category that can be potentially problematic in sport marketing.
One of the emergent issues in sport marketing is the rapid rise of sports
gambling. Although it has been pervasive in some markets, such as Australia and
the UK, its recent rise to the fore has been spurred by the legalisation of sports
gambling in the United States back in 2018. What is significant about this move is
that it unlocked a very lucrative market; the sports gambling marketplace in the
United States is anticipated to be a $150 billion (Sherman, 2019). Consequently,
there has been an explosion in sports gambling advertising, especially in the
frequency of activity via social media by major players such as PointsBet, Bet365
and Unibet (Stadder & Naraine, 2020). The number of operators has also increased,
with emergent companies like DraftKings, FanDuel and Penn Gaming creating
more opportunities for partnerships and collaboration with sport properties. One of
the most popular actions in this space has been advertising through jersey
sponsorship placement. Several football teams in the UK have sport gambling
sponsors on their jerseys, including English Premier League (EPL) sides Aston
Villa, West Ham United and Newcastle United, while Bet365 have sponsored
nearly half of the teams playing in Spain’s La Liga (Streeter, 2018). From a
revenue-generation perspective, gambling has been welcomed by sport marketers.
However, there are ethical considerations here given the addictive nature of
gambling and the impressionable nature sport has on younger audiences. Should
sport organisations accept sponsorship from sports gambling operators and promote
addictive behaviours? Here, as well, sport marketers must delicately balance
success for the organisation and promoting healthy habits and behaviours for the
community in which it operates.
There are additional ethical considerations that sport marketers must
contemplate which can be lumped together into a single ‘sin’ category. This refers
to companies whose products can cause adverse health and social issues for
individuals and communities. In addition to gambling, the sin category in sport has
traditionally been composed of alcohol and tobacco companies. For instance,
Toronto’s Indy Car race has been going on for more than 30 years, but has not
always had automotive manufacturer Honda as its title sponsor. For the first 20
years the event’s title sponsor was Molson, a popular Canadian beer brand and now
part of the fifth largest brewery by volume in the world. In that circumstance,
organisers had to consider whether having a sin category firm as the title sponsor
for the event was responsible given that many minors would attend and watch the
event, and it could be perceived as promoting alcoholism (and the adverse health
and social effects associated with the disorder). Similarly, motorsports marketers
also had another sin category, tobacco, sponsoring their events for long periods of
time. Major F1 constructors were linked with tobacco firms, including Scuderia
Ferrari with Philip Morris’s Marlboro brand and McLaren Mercedes with German
company, Reemtsma (Dewhirst & Hunter, 2002).
While some sports have made moves to prevent some sin categories from
partnering with sport organisations, there is still an imbalance of sin category
companies continuing to be involved, including those in the confectionary, coffee,
soft drinks and fast-food space. Recently, products including cannabis, for example,
are raising further concerns. While cannabis use in many countries is prohibited,
there is a growing sentiment globally regarding the acceptance of cannabis
products, including infused drinks, oils and other edible products. In fact, there is a
growing list of professional athletes who have noted their use of cannabis products
for pain management. As this trend continues, sport marketers will have to
determine whether the benefits of working with companies that pose risks outweigh
the potential negative sentiment from certain fans and community groups who are
opposed to cannabis use in society.

Sport marketing strategy revisited

In order for the modern sport marketer to effectively manage a strategy, it is
important to consider control elements, KPIs, organisational roles and structures,
and the ethics surrounding certain programmes and initiatives. Collectively, these
factors help shape the formation and execution of the sport marketing strategy.
Therefore, it is vital that a sport marketer recognises these impacts and integrates
them into their decision-making. It is also important to remember that these
characteristics can affect the identification, determination and implementation of
the overall strategy, and thus sport marketers must be familiar with the stages of the
SSMPP. Having knowledge of this chapter’s strategic management considerations
alongside the SSMPP can enable the sport marketer to apply a framework to
prepare the marketing plan with the macro- and micro-level details contained
throughout this book. A review of the three SSMPP stages is provided in Figure
12.3 to reinforce this structured, step-by-step approach.

Figure 12.3 Strategic sport marketing process

Stage 1, ‘identification of marketing opportunities’, should remain fairly constant.

As each organisation prepares to enter a new three- to five-year plan, renewed
analysis of the environment and review of the organisation’s capabilities should be
undertaken. Importantly, this review should recognise the changing forces driving
competition in the sport and recreation industry. This book has already noted
changes in the competitive forces faced by sporting organisations during the past 30
years, and some emergent trends are noted in the next section. Decisions taken in
regard to the overall analysis of the organisation filter down to the marketing
mission and objectives set to allow marketing activities to contribute to broader
organisational goals. Most of these decisions are based on the market research and
data available to accurately assess buying patterns and consumer behaviour in
general.
Stage 2, ‘strategy determination’, represents the greatest detail provided in this
book. This is because it is at this stage of determining the core marketing strategy
that the range of marketing mix variables can be varied to suit the circumstances
confronting an organisation. The reason for selecting the mix of variables also
changes depending on whether a repositioning exercise is required. Stage 2 also
represents the greatest unknown in terms of ‘Have we chosen the right core
marketing strategy?’ There is no correct answer to this question. It can only be
answered over time, and even this is subject to the ability of staff to implement
marketing plans.
 Stage 3, ‘strategy implementation’, consists of measuring performance based on
standards determined earlier in the process and, where necessary, modifying or
altering the way in which the core marketing strategy is implemented. Control,
implementation and coordination, as discussed in this chapter, are crucial to the
overall success of the marketing strategy. Implementation, like strategy
determination, is an ongoing process. As one season or event rolls into the next, it
becomes important for marketing personnel to step back every so often to assess
progress and ensure that strategies are not subject to rapid change based on short-
term success. In particular, for seasonal sports it is important that week-by-week
winning or losing does not unduly interfere with strategic marketing plans, usually
prepared for three to five years. This is one of sport’s greatest pitfalls: reacting to
short-term poor on-field performance.
Implementing and managing the sport marketing strategy is guided by the
assumptions made during the planning process. Because all strategies and action
plans are based on these assumptions about the future, they are subject to
considerable risk. It is necessary for marketing managers to assess continually the
assumptions on which strategies were based. It is here that the beginning and end of
the planning process meet. In fact, there is never an end as the cycle continues in a
feedback loop that sometimes blurs beginning and end. To some extent this is a
good sign. It indicates that once the plan and associated strategies are formulated,
they are not simply put on the shelf. Plans put into action are subject to contingency
planning to correct assumptions that do not prove to be true. Therefore, the SSMPP
is dynamic, rarely stagnant and laden with challenges to ensure that the full
potential of marketing’s contribution to the overall functioning of a sporting
organisation is optimised.

Sport marketing trends and their impact on strategic marketing

This book has positioned sport marketing as a central component for many types
and levels of sport. It has focused on strategy development that can aid participation
and development, as well as the marketing and growth of corporate sports, elite
leagues and major events. Now embedded as part of the experience economy
(Funk, 2017), the development of successful strategies requires a focus on internal
and external influences. From the 1980s and 1990s onwards, sport marketers have
continually seen sport embrace commercialisation and professionalisation. As a
result, sport has generated and attracted more revenue and profile and, in turn,
provided more opportunities for participants, athletes, brands and sport marketers to
contribute to health, community and social outcomes.
In discussing a range of environmental trends, we have sought to embed a
framework to be considered around the growth and development of strategies for
sport organisations. Legal and economic factors have provided a setting for the
development of sport; but most clearly a focus on new markets and growth,
adoption of new products and services and innovation will continue to be primary
influences on sport marketing strategy.
In the following sections, we present a collation of themes for sport marketers to
consider as emergent themes that impact the current and future development of
sport marketing strategies. These include marketing theory and a range of
environmental factors, of which technology and digitalisation, innovation and
social considerations are posited to be among the most critical. It is hoped that, as a
closing section to this book, these factors provide for reflection on how these areas
in particular will impact the frameworks and strategy development guided by the
earlier chapters.

Marketing themes: sport experiences and engagement

It should not be surprising that while we position sport as a unique context, we still
clearly observe tenets of mainstream marketing theory that impact sport marketing.
In Chapter 1 we saw that the customer or fan has increasingly become more central
to sport marketing and the consideration of strategy development. Chapter 10 spoke
of the impact and need for marketing to develop consumer–organisation
relationships, while Chapters 3 and 4 developed frameworks to encourage
connections and the utilisation of segmentation approaches. Further, Chapter 5
recognised the continuing importance of developing and leveraging brands to
influence consumption and loyalty. None of these trends sit in isolation; nor will
they be less important in the development of strategies going forward.
More widely in this book we commonly position sport as part of the experience
economy (Funk, 2017). Developing from a product and service orientation, this
reflects an ongoing need to consider and embed consumer needs in the design and
solution process within the context of marketing exchange. Further, sport continues
to provide strong examples of moving to a service logic, encouraging marketing
approaches that are aligned with the concept of ‘co-creation’ of value applied to
sport (McDonald & Karg, 2014). In short, this means organisations and consumers
or groups of consumers working together to create value, allowing consumers to
engage in decisions and practices and more deeply embed their consumption
experiences in more interactive and meaningful ways. How can marketers ensure
the development and design of products and experiences that allow this?
Consumer engagement is another centralised concept for marketing with strong
application to sport marketing strategies. Engagement in leisure, participatory sport
and ‘fan engagement’ settings has increasing relevance for marketers. Whether in
the consideration of a digital, physical or hybrid setting, the concept necessitates a
focus on a range of affective, cognitive and behavioural forms of engagement
(Brodie et al., 2013). That is, sport represents a combination of emotive and
hedonic outcomes and interactions, learning and information sharing processes, as
well as behaviours that are undertaken and observed. In short, when we connect to
sport, as a high involvement product or service, it is not just behaviours that need to
be observed and encouraged, but a wider range of outcomes and interactions.

Growing sport globally and locally: new markets and products, fewer
barriers
One of the major changes to sport has been the reduction in barriers to consumption
and the increased access and ability of sport marketers to develop and grow brands
and products. This can be evidenced in the breadth of products and content for sport
fans. Compared to past decades, accessibility not only of matches and games in
overseas leagues and events but also access to athletes and to non-matchday content
has rapidly expanded. By using mobile and connected devices, watching live sport
or accessing audio, video or statistical content is more accessible than ever. As a
result of digital technology, the processes needed to create, share and commercialise
content are easier, and the costs lower than ever for organisations.
Part of this is related to globalisation. The FIFA World Cup, the Olympics and
the Formula 1 calendar present truly global events. Further, sports such as netball
and rugby continue to report international growth (in participation and elite
performance) as a success factor. Bodies like the English Premier League and the
National Football League are among those hosting games or pre-season tours in
non-traditional markets to grow their brands and interest. The Australian Open
tennis event was rebranded as the ‘Grand Slam of the Asia-Pacific’, and the
country’s V8 Supercars Championship has taken races to multiple new continents.
Commonly, Asia presents as a sought-after international market with massive scope
for growth given its position as one of the world’s fastest-growing economic
regions. FIFA World Cups, Winter and Summer Olympics and Rugby World Cups
have all been scheduled in the region in recent years, while China and India present
rapid growth cases for relatively new professional leagues. As with all globalisation
though, these examples present implications for stakeholders and marketers, with a
need to understand various social, ethical and cultural differences across markets.
While the global examples are prominent, similar growth and opportunities can
be considered for local or smaller sport organisations. In short, what works in terms
of growth via new channels and new offerings is just as relevant for local clubs as
global ones. The ability to efficiently produce and disseminate live or other forms
of sport content is more accessible than ever. As such, it is not uncommon for
amateur sport teams or leagues to live stream games or share and promote their
offerings in new and innovative ways using new media channels. Fewer barriers,
and access to new communication forms and digital practices, provide a recipe for
marketers to develop strategies to communicate with new and existing audiences in
cost-effective ways.

Innovation: new products and new delivery

In considering new opportunities and growth, new products and methods of
delivery emerge clearly as part of the sport marketing exchange. To this end, greater
levels of innovation and entrepreneurship can be seen in the sport marketing setting
(Ratten, 2018).
In developing new or emerging offerings, Ultimate Fighting Championships and
the Indian Premier League (and other short forms of cricket) are among the success
stories of the last decade. New ways of creating and promoting sport have been
critical here, with private ownership and digital models important components. In
North America new ‘Athletes Unlimited’ competitions, such as in lacrosse are
placing the athlete as the focus of the sport, and finding new ways to engage fans.
The rise of lifestyle, extreme or action sports and the continued merging of sport
and entertainment have become mainstream. From the X Games to acceptance in
the Olympics, sports like skateboarding and BMX have developed platforms to
further their legitimacy and growth. Esport continues on the horizon as a digital
form of sport which is building audiences and value as a product offering while
being increasingly embraced by traditional sport forms and stakeholders.
As well as new and rebranded sports, changes to the delivery of sport are
highlighted in this book. For sport fans as consumers, enhanced product choice,
platform choice, on-demand content and new forms of consumption and
interactivity have been facilitated, largely driven by digitalisation. For participants,
the current environment offers new ways to communicate with and access coaches
and high-performance tools, as well as self-tracking technology. In short, we are
seeing a more personalised and digitalised approach to elite sport training and in
sport for health and fitness settings. An example is in stratified sports, where new
forms of digital (virtual) rowing and cycling have evolved as activities done on
equipment at home or other fixed locations, in interaction with virtual courses,
events or competitions. Technology allows participants at a local club or at home to
compete in a ‘digital’ Tour de France stage or race against an elite ‘digital’ rowing
team. This extended to the first digital games being accepted and run by the
International Olympic Committee (IOC, 2021), another sign of the combination of
innovation and reduced barriers.
Such digital practices and innovation need careful consideration regarding
organisations’ capacity and strategy. As per the earlier examples in this chapter of
NBA teams, at a minimum this extends to more defined needs to resource digital
and content staff and skill sets within sport organisations. While creating scope for
more products, members, revenue and new forms of relationships, the above
examples are among parts of an ongoing innovation cycle that will continue to
present new opportunities and drive new solution development.

Technology and data focus

Related to the growth, digitalisation and innovation themes discussed above is the
role of technology and data. Considering the main forms of sport consumption –
spectating in stadiums and other venues, at home or via mobile devices, or
participating in sport – this book has provided numerous examples of how
technology is impacting the creation and execution of strategies. Much of this
comes from how sport is distributed, including the opportunities within stadiums,
where increased interactivity and personalisation are critical to customer
experiences. The stadium experience is being augmented, from in-seat ordering and
delivery to access to media and behind-the-scenes content in real time. Wi-Fi and
mobile apps (Naraine et al., 2020) have helped improve the quality of experiences,
while emergent technology like blockchains (Naraine, 2019b) will continue to
disrupt ticketing, and home ground experiences will be enhanced with immersive
media such as augmented and virtual reality. The internet has also facilitated new
ways for sport media content to be created and shared at home or in mobile settings.
Beyond linear or free-to-air broadcasting the sport media setting presents new ways
to access content and engage audiences, including ‘second screen’ content and
broadcast extensions.
Underpinning this is the role of data that enables a more customised experience.
Used well, it can provide consumers with deeper understanding; allow the
presentation of more focused and customised sales offers; and allow marketers to
better understand trends and improve experiences. Like social media, e-commerce
(retailing through websites or social media platforms) continues to gain traction,
with data-empowered approaches playing a key role. Facebook, Twitter, YouTube,
Instagram and TikTok provide interactive extensions for teams, leagues, events and
athletes in different ways. Fantasy sport, online gaming and gamification are all still
developing concepts linked to audience growth and engagement.
As well as data, what was termed ‘Industry 4.0’ provides a setting to consider
the technology inherent in future growth in this space. Artificial intelligence (AI),
machine learning and advanced analytics, the internet of things and connected
devices, immersive media (including AR and VR), robotics and blockchain are all
rapidly developing components that will seek to play roles in sports innovation and
the delivery of strategic sport marketing efforts in the next decade.

Social considerations
Finally, and perhaps to balance the innovation and technologically focused
discussion above, understanding that sport remains a social good is a critical
component. Ethical practices for sport marketers were introduced earlier in this
chapter. In addition, sport’s ability to show social leadership and align with
consumer expectations and values remains critical for sport managers, with
marketers having a key role. Sport, as a high-profile product associated with well-
known brands, has the capacity to show leadership for the greater good, develop
social connection and drive social change.
In recent settings, inclusion and equality present as part of sport’s agenda for
social leadership spanning gender, racial and other equality issues. While clubs,
leagues and events have shown support and led change in different ways, what is
clear is an enhanced focus and expectation for sport organisations to embed and
show social leadership. Clearly marketers have a role to play here. From the
development and centralisation of inclusive philosophies, developing strategies and
managing and promoting campaigns, there are important considerations of how new
and existing components of an organisation’s marketing mix might be impacted.
Above all, authenticity is critical. Inclusive practices and strategies must be well
embedded in organisational and marketing planning and execution – not mere add-
ons.
An ongoing focus on a range of health, community and environmental issues is
also prominent here in strategy design. Sport is seen as a vehicle for change and
impact, whether the driver is a league, event, team or athlete. From disaster
recovery to social connection, community skill-building or mental health awareness
campaigns, or organisations’ sustainability efforts, leadership and impact can occur
when opportunities are embraced. Corporate social responsibility (CSR) and
community-oriented practices are growing illustrations of how sport brands can
play a critical and central role (Rowe et al., 2018). This can be evident at local
through to elite, professional levels of sport. Product, service and campaign
strategy, brand use, messaging, positioning and execution are all marketing mix
considerations.
Finally, in balancing the multiple needs and objectives presented at the start of
this chapter – from social or participant through to commercial goals – sport has an
inherent but complex responsibility to balance tensions between the commercial
and social outcomes of a sport organisation. This can be evident at the elite level
from the failed effort to create a European Super League (ESL) in 2021. Major
global teams in Europe’s top football leagues that indicated interest in a breakaway
competition were swiftly met with a consumer and public backlash amid fears of a
perceived loss of sporting, cultural and historical ties should the plan progress. Such
challenges are met by many sport marketers at all levels, from decisions to invest
marketing budgets in promotions at the expense of development programmes, to
decisions to accept a corporate or commercial sponsorship that will rebrand a
stadium or pavilion. A nuanced understanding of markets, consumers, brands,
products and promotional options, and the strategic process provided in this book,
is necessary to manage such complexity now and in the future.

Summary
As the final component of this book this chapter has focused on the management
and implementation of sport marketing strategy. A key component is how the
strategy is managed, including the three control mechanisms, and consideration of
links to marketing and performance outcomes. How the marketing function is
operationalised was introduced, including examples of the design of marketing
functions in both smaller and larger markets. Such examples provide a basis for
readers to continue to explore the development of the marketing function in
different organisations, as well as roles and careers that each can provide.
Finally, ethical considerations and a number of trends and considerations within
the current sport marketing environment were discussed. While all components of a
traditional environmental analysis (legal, economic, social, demographic and
technological) were noted, our focus (based on the nature of the earlier chapters)
was on the social, technological and innovation aspects that will most critically
impact the development and execution of strategic sport marketing strategies.
Returning to our core definition of sport marketing centred on the development and
exchange of value, organisations and marketers who best develop and implement
strategies while cognisant of these themes, and who develop operational functions
and structures that can embrace them, are best placed to develop competitive
advantage.

CASE STUDY
Analysing sport marketing structures and futures
In this chapter, we have identified the hierarchal structures for different sport
organisations, with a spotlight on some of the unique roles in each. Now it’s your
turn to do some external research.

Part 1: In groups, or on your own, examine the organisational composition of

two sports entities not mentioned in this chapter. Some potential examples
include teams in the English Premier League, the Australian Football
League, the Indian Premier League, Super Netball and the National Women’s
Soccer League. After choosing the team or organisation, start to look at the
structure of the marketing operations – e.g., the number of sport marketing
specific positions within the organisation – and how it might differ from
those presented in this chapter.
 Part 2: Once you have completed the activity in Part 1, identify which sport
marketing pathway you would like to pursue in the future. This exercise
requires some reflection from the entire text, considering elements like the
marketing mix (for example), as well as the learnings from this chapter.
Consider a specific position or role that might be attractive to you, and an
organisation you might like to be involved with.

Questions
1. From your research in Part 1, do you see lots of variance in marketing
functions and structures, or are they very similar? Why do you think teams
are operating with different or similar sport marketing roles?
2. From your research in Part 2, what does this position entail? Is it a new role
or is it more traditional in nature? What type of experience (e.g., education,
internships/practicums) would be needed for someone to take on this
position?
3. Consider your personality, likes/dislikes and general interests, and how they
might impact your pathway selection. Are you on the right track to attain a
position along this pathway? If not, what activities or factors are missing,
and how do you plan on incorporating them in the next few years?
4. Finally, how are the emergent trends discussed in this chapter impacting (or
how might they impact) the structures you found within sport organisations
and the roles you explored within the sport industry?

References
Brodie, R.J., Ilic, A., Juric, B., & Hollebeek, L. (2013). Consumer engagement
in a virtual brand community: An exploratory analysis. Journal of Business
Research, 66, 105–114.
Burchett, J. (1996). News Limited v. Australian Rugby League Limited and
Others,NG 197 of 1995, Federal Court of Australia, Sydney.
Dewhirst, T., & Hunter, A. (2002). Tobacco sponsorship of Formula One and
CART auto racing: Tobacco brand exposure and enhanced symbolic imagery
through co-sponsors’ third party advertising. Tobacco Control, 11, 146–150.
Funk, D.C. (2017). Introducing a Sport Experience Design (SX) framework
for sport consumer behaviour research. Sport Management Review, 20(2),
145–158.
IOC (2021, April 21). IOC makes landmark move into virtual sports.
https://olympics.com/ioc/news/international-olympic-committee-makes-
landmark-move-into-virtual-sports-by-announcing-first-ever-olympic-virtual-
series.
Jays Care Foundation (2019). RBI program report 2019.
https://img.mlbstatic.com/mlb-
images/image/upload/mlb/i77fa1qcncbrgxiygykq.pdf.
McDonald, H., & Karg, A. (2014). Managing co-creation in professional
sports: The antecedents and consequences of ritualized spectator behavior.
Sport Management Review, 17, 292–309.
Misener, K., & Doherty, A. (2009). A case study of organizational capacity in
nonprofit community sport. Journal of Sport Management, 23, 457–482.
Mullin, J., & Walker, Jr, O.C. (2009). Marketing management: A strategic
decision-making approach (7th edn). McGraw-Hill, New York.
Naraine, M.L. (2019a). Follower segments within and across the social media
networks of major professional sport organizations. Sport Marketing
Quarterly, 28, 222–233.
Naraine, M.L. (2019b). The blockchain phenomenon: Conceptualizing
decentralized networks and the value proposition to the sport industry.
International Journal of Sport Communication, 12, 313–335.
Naraine, M.L., & Parent, M.M. (2017). This is how we do it: A qualitative
approach to national sport organizations’ social-media implementation.
International Journal of Sport Communication, 10, 196–217.
Naraine, M.L., & Wanless, L. (2020). Going all in on AI: Examining the value
proposition of an integration challenges with on branch of artificial
intelligence in sport management. Sport Innovation Journal, 1, 49–61.
Naraine, M.L., O’Reilly, N., Levallet, N., & Wanless, L. (2020). If you build
it, will they log on? Wi-Fi usage and behavior while attending National
Basketball Association games. Sport, Business and Management: An
International Journal, 10, 207–226.
Naraine, M.L., Wear, H.T., & Whitburn, D.J. (2019). User engagement from
within the Twitter community of professional sport organizations. Managing
Sport and Leisure, 24, 275–293.
Parent, M.M., Naraine, M.L., & Hoye, R. (2018). A new era for governance
structures and processes in Canadian national sport organizations. Journal of
Sport Management, 32, 555–566.
Ratten, V. (2018). Sports innovation management. Routledge, London.
Rowe, K., Karg, A., & Sherry, E. (2018). Community-oriented practice:
Examining corporate social responsibility and development activities in
professional sport. Sport Management Review, 22(3), 363–378.
Shapiro, S.L., DeSchriver, T.D., & Rascher, D.A. (2017). The Beckham effect:
Examining the longitudinal impact of a star performer on league marketing,
novelty, and scarcity. European Sport Management Quarterly, 17, 610–634.
Sherman, A. (2019, April 27). Legal gambling from your phone could be a
$150 billion market, but making it happen will be tough. CNBC.
https://www.cnbc.com/2019/04/27/fanduel-draftkings-race-to-win-150-billion-
sports-betting-market.html.
Stadder, E., & Naraine, M.L. (2020). Place your bets: An exploratory study of
sports-gambling operators’ use of Twitter for relationship marketing.
International Journal of Sport Communication, 13, 157–180.
Streeter, J. (2018, August 2). Bet365 unveils partnerships with half of Spain’s
La Liga clubs. SBCNews.
https://www.sbcnews.co.uk/marketing/2018/08/02/bet365-unveils-
partnerships-with-half-of-spains-la-liga-clubs/.
Thompson, A., & Parent, M.M. (2021). Understanding the impact of radical
change on the effectiveness of national-level sport organizations: A multi-
stakeholder perspective. Sport Management Review, 24(1), 1–23.
https://doi.org/10.1016/j.smr.2020.04.005.
U SPORTS (2021). 2020/2021 annual report.
https://usports.ca/uploads/hq/AGM/2021/USports_annualReport20-
21_EN_digital_FINAL_V02.pdf.
Yerdon, J. (2011, April 19). NHL and NBC Sports Group sign 10-year
broadcast deal. NBC Sports. https://nhl.nbcsports.com/2011/04/19/nhl-and-
nbc-sports-group-sign-10-year-broadcast-deal/.
Index

Note: Page numbers in italics refer to figures. Page numbers in bold refer to
tables.

Activision Blizzard 90
Adelaide Oval 158
Adidas 6
advertiser-based revenue models 173
advertising 201–202
AFL Grand Final 152–153
A-League competition 27, 39
Amazon 209
ambush marketing 19, 259–260, 261
analytics software, marketing information system (MIS) 77–78
Andreescu vs. Kerber 101
announcers 175
anti-siphoning legislation 174, 177
anti-smoking policy 230
armchair selector syndrome 10–11
artificial intelligence (AI) 87, 254, 277, 292
assurance 229
athlete sponsorship 258
‘Athletes Unlimited’ competitions 290
athletic apparel sponsorship 257
athletic endeavours 54
attendance: and membership 41
and participation 275
sporting clubs 32
attitudes 54, 81, 259–260
attractiveness 17, 258
attribute-based rules 60–61
audience: enjoyment 181
mass 258
measurement 184–186
target audience rating points (TARPs) 185
audio-visual content: distribution 172
rights vs. data rights 181
augmented reality (AR) 277
AusPlay Survey 79
Australia: advertising industry 79
football community 44
telecommunications company 132
Australian Anti-Siphoning List 188–189
Australian Broadcasting Corporation (ABC) 189
Australian Bureau of Statistics (ABS) 78–79
Australian Communications Minister 188
Australian Cricket Board (ACB) 15–16, 34
Australian Football League (AFL) 31, 123, 171, 224, 260
Australian Grand Prix Corporation (AGPC) 122
Australian Institute of Sport, mission statement 35
Australian Open 61, 101, 153
Australian Rugby League (ARL) 33, 272
Australian Rules football (AFL) 55, 92
Australian Sport Commission 50, 79
Australian Super League 272

Bahrain track 17–18

Barbados Royals 108
Basketball England 112
behaviour/behavioural: engagement 66
segmentation 84–87
benchmarking: data 236
performance 43
benefits, segmentation 86
Bet365 284–285
BHP 6
Big Bash League (BBL) 4, 194
BioSteel 198
Bledisloe Cup matches 27
blockchain 277
blogs 17, 55
blueprinted sport service delivery system 158–160, 159
Board of Control for Cricket in India (BCCI) 6, 206
brand 109
culture 283
identity 152
partnerships 246
use in practice 110
break-even analysis 133, 134
Brisbane Football Club 14
Brisbane Lions 66
broadcasting and digital media 276–277
Broadcasting Services Act 189
Bushfire Appeal fundraising game 137
business-to-business (B2B) activities 206
buyer-readiness continuum 254

Candy Crush Saga 87

cannabis 285
Caribbean Premier League 108
cause-related marketing 247
championship 33
Chinese Super League 40
club: -based models 14–15
identification 234
loyalties 32
membership 275–276
merchandise 131
Coca-Cola 108, 186, 198
cognition/cognitive: dissonance 62
effects 255
engagement 66–67
and physical responses 52
progression 253
collaborative projects 17
collective self-esteem 54
Collingwood Football Club 282
colour television 15–16
comfort-focused facilities 106
commercialisation/commercial 248, 288
advertising 12
free-to-air broadcasters 189
free-to-air licence 190
pressures and sport marketer 18
television 173
value, sponsorship 261
communications gap 229
community: -based junior competition 126–127
-orientated partnerships 247
-oriented practices 292
skill-building 292
sports teams 125–126
compensatory rule 61
competition/competitive: advantage 37–38
balance 278
and cooperation 12
forces model 34
intensity 32
marketplace, football codes 27
competitors, pricing behaviour of 123
complaint-inducement 237
complements 127
compound annual growth rate (CAGR) 163
conceptual approach, segmentation 83
concurrent control 43
consistency 12
consumers 59, 197
assess value for money 63
behaviour 50–51, 83
dissatisfied 62
engagement 289
expectations 235
 feedback 236
-focused promotions 203
interpretation and enjoyment 11
involvement 10–11, 62, 64
market segmentation 82
needs 28
–organisation relationships 288
products 12
sport involvement role 62
content communities 17
contests and dealer incentives 204
context of sport 35–36
cooperative advertising 204
core sport product 40
corporate social responsibility (CSR) 247, 292
corporations/corporate: abusive practices 261
hospitality 206, 257
sponsorship and licensing 20, 293
cost: cost–benefit analysis 122
cost–volume–profit relationship 133–135
leadership 41
per seat 164
country-based pro soccer league 40
COVID-19 pandemic 52
credibility 258
Cricket Australia (CA) 15, 30, 34, 39, 154, 194–195
CSR see corporate social responsibility (CSR)
customer: in digital world 7
income 130
journey stage, behavioural segmentation method 86
management, relational approach to 223–225
–organisation interactions 68
satisfaction 11–12, 221, 226–227, 236–237
value 7
customer relationship management (CRM) theory 200, 224

database-led promotions 207

data-driven method, segmentation 83
data-driven segmentation strategy 88
Daytona 500 108
decision(s): -making process 60, 67–68
rules 60–61
defensive marketing 225
delivery gap 229
Deloitte Football Money League 163
demand: market sensitivity 126–127
price elasticity of 129, 129
demographic(s): and social trends 30
segmentation 83
detailed contracts 261
differentiation strategies 41–42
digital advertising 201, 209–210, 282
digital behaviours 186
digital campaigns 256
digital channels 177–178
digital content performance 78
digital data-collection technology 156
digital distribution 181
digital engagement 80
digital marketing 207–210
digital measurement 186
digital media concepts 277
digital natives 90
digital platforms 17
digital sponsorship assets, rise and value of 248–249
digital world, 2021 4
direct and interpersonal communication 206
direct marketing 206–208
disaster recovery 292
disconfirmation of expectations model (DEM) 232, 232
dissatisfaction 231
distribution partners 200
diversification strategy 75
diversion 54
domestic competitions 5, 27
Dota 2 (Valve) 90
DraftKings 284–285
Dress-Up Party 194–195
Dropbox 17
dynamic pricing 41, 131, 135

e-commerce 209, 249, 291

economic deficiencies 32
Eden Park in Auckland 13
elasticity, market sensitivity 130–131
Electronic Arts (EA) 90
email approaches, direct marketing 207
emotion 32, 42
empathy 229
endorsements 197–198
English Premier League (EPL) 40, 163, 170, 285
entertainment 32–33, 221
entrants, threat of 33
environment factors: external 29–30, 30
industry competition 30–33
publics 33–34
Epic Games 90
ESPN 126–127
esteem 54
ethics: and social responsibility 18–19
in sport marketing 261
European league 40
European Super League (ESL) 293
excitement 54
exclusivity rights 261
experience: design concept 51
economy 11
experience-dependent perceptions 232
experimentation, marketing information system (MIS) 81
eye-tracking 254
Facebook 17, 55, 291
face-to-face presentation and communication 206
facility planning 160
FA Cup Final at Wembley 152–153
FanDuel 284–285
fan engagement 141, 289
fantasy sports 17, 291
fast-food chains 284
FA Women’s Super League 170
feedback: control 43
loop 62
feed-forward control 43, 272–273
FIFA Online 3 74–75
FIFA World Cups 90, 289–290
final price determination 139–140
financial stability 278–279
financial viability 36
Football Federation Australia (FFA) 39, 44, 92, 170
Football Money League 246
football/soccer (A-League) 92
F1 Grand Prix 202–203
F1 racetracks 17–18
Fortnite (Epic Games) 90
4G/5G technology 209
freemium model of revenue generation 87
free-to-air broadcasting 188, 291
free-to-air networks 176–177, 186–189 see also television

game satisfaction 234

gamification 291
gender-specific sports 55
generic strategies 41–42
geographic segmentation 84
George Costanza Night 205
global sport shutdown 157
Gold Coast 57
golf clubs 127, 206
government: funding 29–30
legislation 29
policy 29
Grand Prix 140
Grand Slam 129, 181 see also Australian Open
Greater Western Sydney Giants (GWS) 14, 69
Gretzky, W. 198
gross rating points (GRPs) 185
Guyana Amazon Warriors 108

half-time entertainment 101

Halla Bol, powerful message 197
halo effect 237
health-conscious social segment 84
heterogeneity 12, 102
high-involvement decisions 62–63
high-priced athletes 33
high-priced product 123
high-profile cricket players 141
high-quality product 123
high-speed networks: fibre 209
wireless 153
high-tech interactive scoreboards 153
hockey see National Hockey League (NHL)
homes using television (HUT) 185
home-win guarantee 220
human personality traits 53
100-ball league 6
hybrid growth strategy 75
hyper-customisation 182

ice hockey 100

I-League (global football) 206
IMC/promotions mix 213
incremental revenue 141
Indian Cricket League (ICL) 16
Indian Premier League (IPL) 4, 33, 197
Indian Super League 206
individual-level cognitive processes 54
Industry 4.0 292
industry competition 30–33
influential reference groups 54–55
informal communication 113–114
Instagram 55, 291
intangibility 102
integrated marketing communication (IMC) 210
integrated promotional mix 199–200
intellectual property (IP) right 112, 254
interest intensity 173–174
internal data and reports, marketing information system (MIS) 76–77
International Association of Athletics Federations 35
International Cricket Council (ICC) 16
International Olympic Committee (IOC) 248, 291
internet and social media, sport consumption 55
interpersonal communication 206
interviews and focus groups, marketing information system (MIS) 81–
82

Jays Care Foundation (JCF) 270

joint sponsor–sponsee counteract strategies 261
Jurassic Park 110

key performance indicators 274–279

attendance and participation 275
broadcasting and digital media 276–277
club membership 275–276
financial stability 278–279
merchandising and licensing 277–278
service quality 278
sponsorship 276
kitchen table administration 14–15
Klassiker, Der 202
knowledge gap 228
Kontinental Hockey League (KHL) 100
Korean professional soccer league 74–75

leader-board sponsorship 257

League of Legends 90
learning 54
legal and social responsibility constraints 136
leveraging 253–254
libraries and chambers of commerce 79
licensing 113
organisational objectives 112–113
programmes 20, 106, 208
relationships 113–114
strategies 154
life-cycle stage 83
line extensions 109
London Olympic Games Organising Committee 126
long-term commitment 63
long-term pricing goal 125
Los Angeles 107
Los Angeles Lakers 154
Los Angeles Summer Olympics, 1984 107
lost revenue 102
lower-order measurement 255
low-involvement decisions 63–64
loyalty and service quality 278

machine learning and advanced analytics 292

Madden NFL franchises 90
Major League Baseball (MLB) 14, 114, 137–138, 273
Manchester United Football Club 154
Maple Leaf Sports & Entertainment (MLSE) 282–283
market: development strategy 39
equilibrium 127–129
intelligence 78–79
-leading sport experience 235
penetration rates 177
-penetration strategy 38–39
 research 36–37, 79–80
segmentation 82
share 231
marketability 222
marketing: barriers 68
campaign 200
channel 160–162
content 63
definition 6–7
department 154–155
ethical behaviour 18–19
function 154–155
implementation 279
management process 20
objectives 42, 196
‘of’ sport 19–20
opportunities 286
-related benefits 276
in sport management 14–18
themes 288–289
‘through’ sport 20 see also promotion/promotional
marketing information system (MIS) 76, 81
analytics software 77–78
internal data and reports 76–77
interviews and focus groups 81–82
management information system 77
market intelligence 78–79
market research 79–80
observation 82
research design 80–81
marketing mission and objectives: competitive advantage 37–38
generic strategies 41–42
market development strategy 39
market penetration 38–39
product development strategy 39–40
product diversification 40–41
product market expansion 38
marketing mix variables 9, 19
place dependence 137
product mix 136–137
promotion mix 138
market sensitivity: demand 126–127, 128
factors determining elasticity 130–131
market equilibrium 127–129, 128
non-price factors 132
price elasticity of demand 129, 129
supply 127, 128
mass audience 258
mass media: advertising 207
sport consumption 55
mass-participatory initiatives 30
maximising profit/revenue/sales growth 124–125
McDonald’s 284
media distribution: business models and new opportunities 178–182
fragmented sport media experience 170–171
new sport–media nexus 171–174
sport content, demand for 174–176
sport programming, distribution platforms for 176–178
sport programming, measurement 183–187
media-dominant consumers 174–175
Melbourne Cricket Ground (MCG) 13, 132, 152–153
membership, sporting clubs 32
mental engagement and exploration 54
mental health awareness campaigns 292
merchandise 106, 275–276
merchandising and licensing 277–278
microblogs 17
Microsoft Excel 77–78
microtransactions 87
Minor League Baseball (MLB) 204–205
Minor League level of baseball (MiLB) 204–205
MIS see marketing information system (MIS)
mission statement 35
mixed-methods research designs 80
mobile games/gaming 87
motivation 54
multi (social) media channels 153

narrowcasting 177
National Basketball Association (NBA) 14, 107, 152–153, 171, 220,
282–283
National Basketball League (NBL) 5
national broadcasting rights 188
National Football League (NFL) 14, 114, 171, 208
National Hockey League (NHL) 14, 100, 276
National Rugby League (NRL) 18, 92, 220, 272
National Soccer League (NSL) 92
national sport governing bodies 126
negative disconfirmation 232
New South Wales competition 33
New South Wales Rugby League (NSWRL) 38
New Zealand Football 44
Nexon Arena 74–75
Nike 6, 125, 197
non-compensatory rule 60–61
non-price factors, market sensitivity 132
non-profit entities 35–36
non-profit sport organisations 35
non-sport enterprise 101
non-verbal message 196
North Queensland Fury 93
not-for-profit organisations 125–126

occasion- or timing-based, behavioural segmentation method 85

offensive marketing 224–225
off-peak time price 139
Olympic Games 107, 139, 187
marathon 18
movement 107
Olympic Partner Programme, The (TOP) 248
one-day cricket 17, 39
One Day International (ODI) format 4
one-to-one communication 207
online gaming 291
online retailers 199–200
on-site sales 253
opportunities 35
organisations/organisational: control 43
goals 36
and marketing managers 199–200
organisation-wide data 43
overall satisfaction 234
over-capacity 14
Overwatch (Blizzard) 90
OzTAM data 79, 185

part-time marketers 155

pay-per-view programming 177
pay-TV 177–178
PBL Marketing 16
Pebble Beach golf course in California 13
Penn Gaming 284–285
Pepsi-Co 6, 198
perceptions 54, 109
performance 54
perishability 102
personal communication 206
personal factors, sport consumption 53
personal identification, consumer 11
personal selling 205–206
personal survey 81
pervasiveness 10–11
physical evidence: promotion 153–154
sport facility 152–153
PivotTables 78
place: case study 163–166
dependence 137
facility planning 149–152
 people 156
physical evidence 152–154
process 154–156
sporting goods and services, marketing channels for 160–162
as sport marketing component 147–149
sport service delivery system, blueprinting 158–160
playback viewing 185
pleasure and customer satisfaction 52
podcasts 55
point-of-purchase (POP) displays 64, 204
PointsBet 284–285
political forces 29
Portland Trail Blazers 282
positioning strategies for segments 90–91
positive disconfirmation 232
post-2020 pandemic 157–158
post-purchase behaviours 221
power of buyers 32
premiership 33
price/pricing: behaviour, constraints on 135–136
discrimination 139
elasticity of demand 129, 129
pricing strategies 125, 142
community accessibility 125–126
constraints on pricing behaviour 135–136
cost–volume–profit relationship 133–135
final price 139–140
goal 123–124
major competitors 135
marketing mix variables, constraints of 136–138
market sensitivity 126–133
maximum shareholder value 124–125
strategic 124
time-dependence 139
problem solvers 101
product 101–102
attributes 7
 branding 108–112, 110
case study 115–119
development strategy 39–40, 104–106
diversification 6, 40–41
extensions 12, 101, 234, 237
licensing 112–114
market expansion grid 38
mix 136–137
PLC curve 104–108, 105, 108
quality 101
sport brand to extend monetary value 114
product life-cycle (PLC) 104–105, 105, 199
professionalisation/professional 14, 34, 288
leagues 31
sport 280–282
profile and persona, segmentation 88
profitability 31, 222, 231
programmed decisions 60
programme development and implementation 212
Pro Kabbadi League 206
promotion/promotional 195
BBQs and superheroes 194–195
communications model 196–199
consumer behavioural factors 196
definition 195–196
endorsements 197–198
goals 195
IMC/promotions mix 213
licensing 208, 277–278
mix 138
mix variables 200–201
objectives 211–212
process 210–213
sport promoters 196
strategic, integrated promotional mix 199–200
tools for 200–210
well-planned and executed 196
‘Ps’ of marketing 196
psychographic segmentation 84
Psychological Continuum Model (PCM) 64, 65, 66
allegiance 67–68
attachment 66–67
behavioural engagement 65–66
framework 88
stages 65
psychology/psychological: commitment and loyalty 67
connection 66–67
factors, sport consumption 54
imbalance 58
public 33–34
public appearances 261
publicity, sport marketing 12–13
public relations (PR): and publicity 202–203
strategy 13
Puma 6
purchasing: behaviour, behavioural segmentation method 85
concessions 275–276
relationships 223
purpose statement 35
PyeongChang Winter Olympic Games, 2018 107, 204

Quality Excellence of Sports Centers (QUESC) 230

quality product extensions 101
quantitative and qualitative data-collection phases 80
quick-service chains 284

racial equality 52
Rajasthan Royals 197
Raptors 905 282–283
rationalisation strategy 18
reach, audience measurement 185
rebranding 109, 111
relationship marketing 223
reliability 229
responsiveness 229
retail partners 204
revenue 125
-earning 283
-generation opportunity 284
stream 201
rewards and loyalty programmes 208
Rio Olympics, 2016 107, 126
Riot Games 90
Rugby Australia (RA) 26
rugby union (Super 15) 92
Rugby World Cups 289–290
Russian sport landscape 100

sales: growth 125

promotion 203–205
San Jose Sharks 113
satisfaction/satisfied 231–234
consumers 222
customer 153, 226–227, 231
managing 235–238
and positive behaviours 237
rating 236
service quality 220–221, 231–234
and sport experience design 220–221
‘Save Albert Park’ group 122
Scale of Attributes of Fitness Services (SAFS) 230
season tickets 206, 224
Second Chance Night 205
Second Life 17
second-screen phenomenon 180
segmentation: behavioural 84–86
data-driven strategy 88
demographic 83
methods 83
mobile games 87
profile and persona 88
 psychographic 84
target market selection 88–90
self-concept 54
service: delivery 11–12
satisfaction 234
service-based club-performance 234
service quality: case study 238–240
conceptual model of 228
customer management, relational approach to 223–225
customer satisfaction 226–227
definition 226
key performance indicators, sport marketing 278
managing 235–238
modelling service quality 227–229
satisfaction 220–221, 231–234
services and experience economy 221–222
SERVQUAL and applications to sport 229–231
sport experience design 220–221
sport services, definition 222–223
Service Quality Assessment Scale (SQAS) 230
Service Quality of Sports Participants (SSQPS) scale 230
SERVQUAL and applications to sport 229–231
servuction 155, 155–156
7Ps of marketing 8, 42
short message services (SMS) 207
short-term goal 124
Silent Night 205
‘Simply the Best’ advertising campaign 38–39
simultaneous production and consumption 102
Singapore Sports Council 29
situational factors, sport consumption 55–57
situation analysis 210–211
sociability 54
social consciousness 18–19
social factors, sport consumption 54–55
social interaction 54
socialisation, performance, entertainment, esteem and diversion
(SPEED) 84
social media 13, 17, 142, 200
social networking sites 17
social responsibility 136
socio-cultural environment 54–55
South American Lacrosse Federation (SALF) 115
South Melbourne Football Club 13–14
South Sydney Rugby League club 18
Spalding 6
Special Broadcasting Service (SBS) 189
SPEED 84
spiritual home of sport 132
sponsors: bargaining 32
sponsor-engaged nights 205
sponsorship 12, 206
advantages and disadvantages 258–259
ambush marketing 259–261
behavioural measurement of 256
building global sponsorship portfolios 246
case study 262–264
communications mix 63
definition 246–247
digital sponsorship assets, rise and value 248–249
goals and objectives 251–252, 252
key performance indicators, sport marketing 276
local and traditional forms 246
management 249–256, 250
market for 247–248
measurement 254–256
properties 256–258
revenues, sporting clubs 32
works 252, 252–254
sport: club membership 104, 224
communication process 196
context and marketing 4–6
economy 33
 experience 11
franchises, capturing and monetising value 131
marketers 12, 37, 235, 277
marketing mix 8
-marketing planning process 28
–media relationship 174
organisations 51, 235
participation 230
product 51
programming, measurement 183–187
-related content and information 55
rights, regulation of 188–190
rights-holders 249
as a service 102–103
service-delivery system 156
services, definition 222–223
servuction model 155, 155–156, 222
sponsorship 63
user 51
Sport Australia 29
SportBusiness 114
sport consumers 54, 79
behaviour 51–52, 53, 56, 65–68, 75
behaviour researchers 81
decision 60–61
decision-making process 57–62
digital behaviours 277
evaluation of alternatives 59–60
factors influencing consumption 52–57
information search 58–59
involvement and decision-making 62–64
problem recognition 58
use and evaluation 61–62
Sport Experience Design 51, 220–221
sporting brand 208
sporting clubs and athletes 13
sporting organisations 40
sporting team or event 64
sport marketing 20
attendance and participation 275
broadcasting and digital media 276–277
case study 293–294
characteristics 8–9, 10
club membership 275–276
competition and cooperation 12
concurrent control 273
consumer involvement 10–11
controlling 271–274
control process and measures of success 274
coordinating and implementing marketing strategy 279
definition 19–20
distribution 13–14
ethics 284–285
executives 18
feedback control 273–274
feed-forward control 272–273
financial stability 278–279
key performance indicators 274–279
managers 18, 181
merchandising and licensing 277–278
opportunities, identification 69–70
publicity 12–13
Reviving Baseball in Inner Cities (RBI) programme 270–271
service quality 278
sponsorship 12, 276
sport marketing departments and positions 279–284
strategies 63–64, 286, 286–287
trends and their impact on 287–293
unpredictability 11–12
sport market research and strategy 69, 75–76
behavioural segmentation 84–86
case study 92–94
data-driven segmentation strategy 88
demographic segmentation 83
 geographic segmentation 84
marketing information system (MIS) 76–82
methods 83
mobile games 87
positioning 90–91
profile and persona 88
psychographic segmentation 84
target market selection 88–90
Sport New Zealand 29
stadium attendance 141
stakeholders in sport media distribution 172–174
standards: gap 228
prices 41
setting 42
StarCraft II 75
start-up costs 106
state-based competition 13–14
strategic sport-marketing planning process (SSMPP) 272–273
environment 29–34
illustration 28, 28
marketing mission and objectives 37–42
marketing opportunities, identification 29–42
market research and information systems, utilisation 36–37
organisation, internal capabilities 34–36
strategy determination, implementation and control 42–43
strengths, weaknesses, opportunities and threats (SWOT) analysis 35,
210–211
subscription markets 223
substitutability 32–33, 130
substitutes 126–127
Super 15s competition 27
Super Bowl advertising 182–183
Super Rugby 26, 29
suppliers, power bargaining 33
supply, market sensitivity 127
survey responses and feedback 208
sustainability 37–38, 222
switching cost 32–33
SWOT analysis 35, 43
Sydney Morning Herald 189

tangibles 229
target audience rating points (TARPs) 185
target market selection 88–90
team merchandise 154
telemarketing 81, 206, 207
television: licensing markets 188
ratings 141
televised sport product 13
Telstra 132
Test matches 29
30-second commercials 255
threats 35
3G/4G networks 277
TikTok 291
time-shifted viewing 185
Tokyo Olympic Games 126–127, 172
TOP see Olympic Partner Programme, The (TOP)
Toronto Argonauts 282–283
Toronto FC 282–283
Toronto Maple Leafs 282–283
Toronto Marlies 282–283
Toronto Raptors 110
Toronto’s Indy Car race 285
Tottenham Hotspur Stadium 154, 164
trade 204, 206
trademarks 260
Trade Practices Act 1974 (TPA) 260
tradition/traditional 32
4Ps of marketing 7
consumer goods marketing 154–155
marketing department 156
training programmes 204
Tri-Nations Series 27
T20 194
Twenty20: BBL 7
cricket 5, 17, 40
World Cup 16
Twitter 17, 55, 291

UK Sports Council 29
Ultimate Fighter, The 181
Unibet 284–285
unidimensional marketing programmes 276
unit elastic demand 129
unpredictability 11–12
unprogrammed decisions 60
usage rate, behavioural segmentation method 84–85
US collegiate basketball 203–204
users: behaviour tracker 78
status, behavioural segmentation method 85–86
U SPORTS 280–281

Valve 90
viability 31
Victoria Health 79
Victorian Football League (VFL) 5, 13
video screen signage 101
Virgin Group 6
virtual advertising 182
virtual game worlds 17
virtual Grand Prix series 17
virtual reality (VR) 277
virtual social worlds 17
volume of exposure 255

Wallabies 28
Wanderers and Ellis Park Stadium in Johannesburg 13
weaknesses 35
websites 55
Wembley Stadium in London 13
West Coast Eagles Football Club 14
Wi-Fi connectivity 277
Wikipedia 17
Wimbledon Championships 189
win/lose phenomenon 234
winning games 31
Winter and Summer Olympics 289–290
Women’s National Basketball League in Australia 5
World Athletics (2020) 35
World Cup soccer 187
World Series Cricket (WSC) 16
World Wrestling Entertainment (WWE) 114

YouTube 17, 55, 291

zero disconfirmation 232