sport marketing chapter 5 before
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Fundamentals of Sport Marketing
Chapter 5Segmentation, Target Marketing, and
Positioning in Sport Business 11
Company
Research & Information Collection
Company Mission & Goals
Consumer Competitor Climate
Segmentation
Target Market Decisions
Sport Marketing Mix Decisions & Strategies
Marketing Management Strategies Implementation – Management – Evaluation – Adjustment
The Sport Marketing Management Model
PriceProduct Place Promotion
Figure 3.3 The Sport Marketing Management Model
Company
Research & Information Collection
Company Mission & Goals
Consumer Competitor Climate
Segmentation
Target Market Decisions
Sport Marketing Mix Decisions & Strategies
Marketing Management Strategies Implementation – Management – Evaluation – Adjustment
The Sport Marketing Management Model
PriceProduct Place Promotion
Figure 3.3 The Sport Marketing Management Model
Info on the 4 Cs is used for Segmentation &
Target Market Strategies
Info on the 4 Cs is used for Segmentation &
Target Market Strategies
And, this information informs the segmentation,
target marketing, and positioning strategies
And, this information informs the segmentation,
target marketing, and positioning strategies
► World population – 7 billion► USA population – 311 million might reach 404 million by 2050
► USA population shifting from a majority Euro-white population to a society characterized by several groups:
► Hispanic – now the largest minority population at over 15%; is still fastest growing Black
► African American – expected to grow from 12.8 to 14%► Lesbian & Gay – Third largest minority - estimates are at
10%► Asian – now the fourth largest minority► Many others
Think about this……..
Some Population Information Important for Sport Business (Table
5.1)
► The first billion in world population took from the dawn of humanity until 1830. The second billion took only 100 years -- from 1830 to 1930. The population crossed 7 billion in 2011 and the United Nations predicts it will cross 8 billion in 2023, a rapid growth rate.
► The population of the USA is aging rapidly. In 2020 that number is expected to be 65 million. Most of them will have one year of retirement for every year of work.
► Children under the age of 18, who were 34% of the population in 1970, will be only 25% of the population in 2020.
► At the present growth rate of 1.1% per year, the United States' population will double to about 560 million in about the next 60 years, if current immigration and related trends continue. Each year over 3 million people are added to the U.S. population
► Language is important. There are more that 100 languages spoken in the school systems of New York City, Chicago, Los Angeles, and Fairfax County, Virginia.
► Minority shoppers account for more than 30% of the economy
Some Population Information Important for Sport Business (Table 5.1)
► The United States population increased by nearly 30 million from 2001 to 2010, a 9.7% growth rate
► Despite the recession, 75% of teens are receiving the same or more spending money from 2009 to 2010.
► In 2010, 30% of the world population is using he internet on a regular basis but 78% of the people here in the United States are connected to the web. Additionally some 66% of those users have purchased something online
► The average American spent just 8 hours reading educational books in 2009 but 121 hours playing video games according to the census bureau.
► Inhabitants of American cities are exposed to an average of 5000 advertisements each day. This figure has nearly tripled in the last 30 years.
► USA ranks third largest in population in 2011 at 311 million and is expected to rank third in 2050 with a population of 404 million.
► Today, a marketing professional MUST monitor the population and must shift marketing theories and models to fit the consumer markets.
► New marketing strategies are emerging to keep pace with the changing demographics in the United States.
► Segmentation is used by the marketing professional to target specific groups (target markets) and their characteristics and behaviors.
The object of market segmentation is to develop useful data about a particular group.
Segmentation using one factor/variable selects members from a group that share a particular characteristic, while multiple factor/variable segmentation selects for a variety of characteristics. The latter method is increasingly popular as the culture becomes more multi-faceted.
Purposes of Segmentation
1) Primary purpose is specialization. Using segmentation, the company can select one or more markets on which to concentrate and specialize in meeting that segment’s needs.
2) To divide the whole into parts – puts things into order
3) First step toward understanding consumer groups, determining target markets, and informing marketing mix and positioning strategies.
4) To monitor changes in the segments.
Segmentation
In sport business, segmentation involves dividing consumers and the industry into relatively similar segments for varying purposes. It is the first step toward understanding the consumer, determining target markets, and informing marketing mix and positioning strategies.
1) Sport Consumer Market Segmentation:the division of total markets into relatively homogeneous
segments.
2) Sport Industry Segmentation:the division of the sport industry into relatively
homogeneous segments.
3) Sport Business Segmentation: the division of sports businesses into similar segments.
Segmentation
NOW........ How do you DO segmentation?
Figure 5.1 The Segmentation ProcessFigure 5.1 The Segmentation Process
Segmentation CriteriaStandards to use to determine if a segment is
viable
Identifiability: segments must be identifiable and measurable.
Substantiality: segments must be of a size large enough to justify marketing mix attention.
Accessibility: segments must be reachable with the customized marketing mix.
Responsiveness: segments must respond to a marketing mix customized to that segment.
Segmentation Bases Variables used for segmenting markets
► Segmentation bases are variables (factors) used to divide a total market (population) into segments.
► The sport marketing professional must identify bases that produce a RIGHT mix of identifiability, measurability, substantiality, accessibility, and responsiveness in that segment.
► Markets can be segmented using one or more bases. Some examples: gender, income, age.
Variables Category N % Cumulative %
Household Income Above $200,000$150,000-199,000$100,000-149,000$80,000-99,000$60,000-79,000$40,000-59,000$20,000-39,000Below $20,000
5937
101131151168147
67
6.94.3
11.715.217.519.517.1
7.8
100.093.188.877.161.944.424.9
7.8
Gender MaleFemale
533328
61.937.1
100.037.1
Ethnicity CaucasianHispanicAfrican AmericanAsianOthers
617103
622346
71.712.0
7.22.76.4
100.028.316.3
9.16.4
Marital Status MarriedSingleDivorcedWidowedOthers
460291
461450
53.533.8
5.31.65.8
100.046.512.7
7.45.8
Education College GraduateHigh School GraduateAdvanced DegreeSchool StudentCollege StudentOthers
270189129114
7386
31.422.015.013.2
8.510.0
100.068.746.731.718.510.0
Occupation ProfessionalManagementSalesTechnicalEducationSkilled Worker
207141
75595939
24.016.4
8.76.96.94.5
100.076.059.650.944.037.1
One example of demographics from a study
N = 861
Another example of demographics
from a study
Demographics - Personal Income
Disposable Income – money, after taxes, at your disposal.
Discretionary Income – money, after necessities, to be used at your discretion.
For example, look at the Dome studies handouts in the. “Economic Factors”
sections.
More to know – household and life choices over the lifetime
Demographics: Race and Ethnicity Demographics: Race and Ethnicity
Now… how do you use your segmentation and
target market information to develop marketing
strategies?
Take a look at some examples…. > > >
Key Findings About Black Consumers Strategies for Sport Marketers
1. The Black consumer market is a challenging segment with many cultural nuances that influence their thoughts and behaviors.
Involve individuals with expertise in the Black consumer market in the designing of marketing strategies.
2. Black consumers have unique media consumption patterns.
Use Black media outlets (particularly Black radio) to promote events.
3. Blacks respond more favorable to culturally based approaches of marketing communications.
Advertisements and promotional messages should contain a theme and content that offer a reference point for Black audiences.
4. Blacks often seek a means of identifying with organizations as they decide whether or not to support their businesses.
Engage in activities that allow Blacks to find a self-reference link to identity with the organization.
5. Black consumers often have an allegiance to patronize Black businesses.
Conduct business with Black vendors to provide organizational needs and involve them as corporate sponsors.
6. Black consumers often seek a cultural experience in their leisure activities.
Amend the product/service with extensions that are culturally salient to Black consumers.
7. Black consumers are socially conscious individuals.
Demonstrate a respect for the Black community through socially responsible/cause-related marketing.
8. Black consumers may have personal and structural difficulty accessing the existing channels of distribution.
Distribute tickets through outlets that are easily accessible to Black consumers. Also, find creative ways of exposing the product to the Black communities.
9. Sport behaviors are often a result of socialization occurring during childhood.
Invest in programs to include Black youths to nurture their involvement.
10. Just as any other community, the Black community also has opinion leaders.
Form a support group of Black constituents from various realms of the community to serve as staff multipliers.
Example: Black Consumers and Marketing (Table 5.8)
You can see…..
….segmentation information is used
in a number of ways to inform
decisions and strategies that will
enhance success for the company.
Some Psychological Factors Used in Segmentation
Table 5.14Personality: values, beliefs, habits
Physiological: food, drink, sleep, shelter
Psychological: affiliation, beauty, belonging, curiosity, esteem, independence, love, motive
Lifestyle: household style, parent style, importance of life comfort, culture, financial resources, occupation and education, community
Desire for: acceptance, achievement, comfort, fame, happiness, identification, prestige
Freedom from: anxiety, depression, discomfort, fear, harm, pain, sadness
More to know – basic human psychological characteristics…
Maslow’s Hierarchy of Needs (1954)
Self-actualization Needsself-fulfillment, self-expression
Esteem Needsself-esteem, self-respect, recognition
Social Needslove, appreciation, fun, belonging
Safety Needssecurity, freedom from pain
Physiological Needsfood, water, shelter
More to know and understand about your consumer – the basic human needs (Table 5.15)
Psychographics
More to know -- SPORT SPECIFIC: Why do people play sports
Geographics – One Example of One Use of GeographicsGeographics – One Example of One Use of Geographics
Purchase Behavior
How does your consumer make a
decision about whether or not to buy?
By knowing HOW your consumer makes a decision, you can make plans and
strategies to influence it.
A typical consumer decision-making process (Table 5.19)
All are affected and influenced by personal and social factors.
Step 1 – Problem RecognitionStep 2 – Information SearchStep 3 – Evaluation of AlternativesStep 4 – PurchaseStep 5 – Postpurchase Behavior
WHY DO PEOPLE ATTEND SPORTS EVENTS ?!?
Knowing What Factors Affect Attendance Helps the Sport Business Make Important
Marketing Decisions
Product Use & Benefits
A consumer needs a product to satisfy a need or desire. The product is the tool for the consumer to perform certain functions and realize certain benefits.
Examples:
Softball Bat: Tool to hit a softball. Benefit: improve hitting percentage, etc.
Go to a WNBA game: Tool to be entertained; to seal a business deal. Benefit: have
fun; transact business.
Go to the fitness center: Tool to lose weight, get in shape, or other. Benefit: same.
Subscribe to ESPN Magazine: Tool to keep up with sports news. Benefit: same.
Undifferentiated targeting strategy
Niche targeting strategy
Multi-segment targeting strategy
Selection of Target Market(s)
youn
g
old
race
income
address
gender
Baby boomers
ability
Sports fans
Sport Business Consumers
► Manufacturers► Resellers, Retailers► Sports Governing Bodies► Institutions► Media Sports Enterprises
Some Types…
But wait – there’s more!!!! You and your company might have business consumers.
Business Consumer Segmentation
► Some consumers are businesses. Hence, business-to-business (B2B) marketing.
► B2B marketing involves the marketing of products to individuals and organizations for purposes other than personal consumption. These consumers typically acquire products and services for purposes of manufacturing, production, resale, operations, enhancement of a company’s position, or other business related reason.
► Segmenting business consumers is similar to segmenting end consumers.
Bases for Business Consumer Segmentation
► Geographic Location► Customer Type► Customer Size (can be volume)► Product Use► Purchase Criteria (price, quality,
reputation, delivery)
What else do you need to know?
Industry Segmentation and
Product Segmentation
The Larger Picture….Industry Segmentation
► What is this industry?
► What is included?
► How can one make sense of such a ginormous industry?!?!? :)
How does one navigate around and within such a large
industry?
How big is it?
How fast does it grow?
How do I find my way?
How do I guide my business?
Some ways to segment the industry > >
The Sport Industry and its Segments (Figure 5.11)
► As divided by product function in the Pitts, Fielding & Miller Sport Industry Segmentation Model (1994)
Sport Participatio
n
Sport Production
Sport Promotion
Let’s look at the model > >
SPORT INDUSTRY SEGMENTATION: BY PRODUCT
AND BUYER TYPE
Sport Performance Segment:
Sport performance as offered to the consumer as a participation
or spectatorial product
Sport Production Segment:
Those products needed or desired for the production of, or to
influence the quality of, sport performance
1. Outfitting Products
a. Equipment
b. Apparel
2. Performance Production Products
a. Fitness Trainer
b. Medical Care
c. Sport Facilities
d. Governing Bodies and Officials
1. Athletics
a. Amateur Sport
b. Professional Sport
2. Private Business Sport
3. Tax-supported Sport
4. Membership Supported Sport Organizations
5. Non-profit Sport Organizations
6. Sport Education
7. Fitness and Sport Firms
1. Professional Merchandising Products
2. Promotional Events
3. The Media
4. Sponsorship
a. Single Event Sponsorship
b. Multiple Event Sponsorship
c. Single Team Sponsorship
d. Individual Sponsorship
e. Circuit or League Sponsorship
5. Endorsement
a. Individual Endorsement
b. Team Endorsement
c. Full Organization Endorsement
d. Nonspecific Sport Use
Sport Promotion Segment:
Those products offered as tools used to promote the sport
product
SPORT INDUSTRY
All sport and related products – goods, services, places, people,
and ideas – offered to the customer
The Sport Industry Segment Model
Pitts, Fielding, & Miller (1994)
Based on the product’s function
Now that we have a target market,
how is this information used to position the business for competitive advantage?
Positioning the Sport Product or Sport Business
What is positioning?
-- the process by which marketers try to create an image or identity in the minds of their target market for its product, brand, or organization. It is the 'relative competitive comparison' their product occupies in a given market as perceived by the target market.
More simply, a product's position is how potential buyers see the product, and is expressed relative to the position of competitors.
One significant use of target marketing is…..
Road Atlanta
Road Atlanta is recognized as one the world’s best road courses. Our multi-
purpose motor sports facility is situated on 750 park-like acres in the rolling hills of
Northeast Georgia. Road Atlanta is located 35 miles north of Atlanta and just minutes away from Chateau Elan, a 4-Star resort
offering guests comfort and amenities such as three championship golf courses and a
European-style Spa. The facility is utilized for a wide variety of events, including
professional and amateur sports car and motorcycle races, racing and driving
schools, corporate programs and testing for motorsports teams.
360˚ Sports Academy LLC
360˚ Sports Academy is dedicated to developing student-athletes into leaders.
We endeavor to empower student-athletes to be the best they can be. The overall
takeaway from 360˚ Sports Academy is a holistic, life-building and applicable
experience that will benefit all participants on many levels and empower the next
generation of leaders. 360˚ Sports Academy offers a full spectrum of training
programs for student-athletes and their parents. The topics, treated in-depth and
addressed by subject matter experts, range from test-taking strategies, finance basics,
health and wellness, and presentation/interview skills, to sports-
specific athletic and game insights, techniques and drills.
Table 5.25 Examples of Positioning Statements
Table 5.26 Examples of Positioning Statements: Multiple Target MarketsTable 5.26 Examples of Positioning Statements: Multiple Target Markets
Red Rocket Jet Ski Company
Overall Positioning Statement:
Red Rocket Jet Skis has the best selling line of PWCs on the market today. Our PWCs are rated highest for ease of use,
durability, reliability, fuel efficiency, and fun.
Business Target Market:
Our line of working jet skis are all you need for emergency, rescue, or waterway
control. Our jet skis are built tough to give you more years of service and
dependability, ready to serve in the line of duty when you need them. Traditionally or custom rigged, your company can have a
fleet of the most rugged and dependable jet skis on the water today.
Recreational Target Market:
The Rocket is built with your fun in mind! No company offers the variety of jet skis
that we do. No matter what your fun requirements, we’ve got the jet ski for you
- fun, fast, and safe.
Red Rocket Jet Ski Company
Overall Positioning Statement:
Red Rocket Jet Skis has the best selling line of PWCs on the market today. Our PWCs are rated highest for ease of use,
durability, reliability, fuel efficiency, and fun.
Business Target Market:
Our line of working jet skis are all you need for emergency, rescue, or waterway
control. Our jet skis are built tough to give you more years of service and
dependability, ready to serve in the line of duty when you need them. Traditionally or custom rigged, your company can have a
fleet of the most rugged and dependable jet skis on the water today.
Recreational Target Market:
The Rocket is built with your fun in mind! No company offers the variety of jet skis
that we do. No matter what your fun requirements, we’ve got the jet ski for you
- fun, fast, and safe.
Big Valley Indoor Soccer Club
Overall Positioning Statement:
Big Valley is the most flexible indoor soccer facility in the city. For any of your needs - practice, fun, or competition - Big
Valley is here with the best.
Business Target Market:
We offer the best practice facility for soccer or field hockey in the area. Just call and talk
to our friendly staff today and schedule your practice. And if you need the coaching
room, just let us know! We have a fully equipped coaching room just waiting for you and your team - the place where you
can plan your winning strategy.
Recreational Target Market:
The best soccer fun in town! Looking to play indoor soccer for fun? Or is your team looking for some serious competition? We
have both! Every session includes recreational and competitive divisions. We also have age-group divisions from under-6 to 40-plus. Register your team today - the
next league starts soon.
Big Valley Indoor Soccer Club
Overall Positioning Statement:
Big Valley is the most flexible indoor soccer facility in the city. For any of your needs - practice, fun, or competition - Big
Valley is here with the best.
Business Target Market:
We offer the best practice facility for soccer or field hockey in the area. Just call and talk
to our friendly staff today and schedule your practice. And if you need the coaching
room, just let us know! We have a fully equipped coaching room just waiting for you and your team - the place where you
can plan your winning strategy.
Recreational Target Market:
The best soccer fun in town! Looking to play indoor soccer for fun? Or is your team looking for some serious competition? We
have both! Every session includes recreational and competitive divisions. We also have age-group divisions from under-6 to 40-plus. Register your team today - the
next league starts soon.
Competitor
Research & Analysis
Mission
Consumer Company Climate
Segmentation
Target Market Decisions
Sport Marketing Mix Decisions & Strategies
PriceProduct Place Promotion
Marketing Management Strategies
Implementation – Management – Evaluation Adjustment
Sport Marketing Management Model
Segmentation leads to target
market decisions
Competitor
Research & Analysis
Mission
Consumer Company Climate
Segmentation
Target Market Decisions
Sport Marketing Mix Decisions & Strategies
PriceProduct Place Promotion
Marketing Management Strategies
Implementation – Management – Evaluation Adjustment
Sport Marketing Management Model
Info on the 4 Cs is used for
Segmentation & Target Market
Strategies
And, this info leads to marketing mix decisions and
strategies
End ! ! ! ! !
Chapter 5 Segmentation,
Target Marketing,
and Positioning
End ! ! ! ! !
Chapter 5 Segmentation,
Target Marketing,
and Positioning
Questions ? ? ? ?Questions ? ? ? ?
End
