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Chapter 22

Chapter 22. Controversial Issues in Sports Marketing. McGraw-Hill/Irwin. ©2007 The McGraw-Hill Companies, All Rights Reserved. Controversy. Marketers Face Continuous Scrutiny For Sports Marketers, Criticism Emanates from Many Different Groups Consumers Consumer Advocacy Groups

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Chapter 22

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  1. Chapter 22 Controversial Issues in Sports Marketing McGraw-Hill/Irwin ©2007 The McGraw-Hill Companies, All Rights Reserved

  2. Controversy • Marketers Face Continuous Scrutiny • For Sports Marketers, Criticism Emanates from Many Different Groups • Consumers • Consumer Advocacy Groups • Community Residents • Fans • Media • Government

  3. “Do The Right Thing” • Ethics Is Subjective • Any Decision May Evoke Controversy • Critics Are Vocal • Issues for Both the Marketing of Sports and Marketing Through Sports

  4. Controversial Issuesin Sports Marketing • Target Market Decisions • Marketing Mix Decisions • Product • Distribution • Pricing • Promotion • Broad-Based Controversies

  5. Target Market Decisions • Exclusionary Membership Policies • Private Clubs Excluding Women or Minorities • Protests Regarding Masters Golf Tournament • Targeting Children • Expensive Products • Creating Unrealistic Expectations

  6. Product Decisions • Oversaturation of Spectator Sports • More Teams, Longer Seasons, More Sports • More Post-Season Participants • Gimmick Sports • Contrived Competitions • Athletes Outside of Their Sport • Focus on Sexuality Rather than Sport

  7. Product Decisions • Appearance Money • May Cause Ticket Prices to Go Up • May Not Be a Good Investment • TV’s Role in Spectator Sports • Media Time-Outs • Event Scheduling

  8. Product Decisions • Changing the Spectator Sport Core Product • Traditionalists Will Resist • Did the Change Make the Game Better • Player Mobility • Often Cited as the “Business Side” of Sports • Players Deemed “Greedy” - Moving for Money • Owners Deemed “Cheap” – Money over Fans

  9. Product Decisions • Unwholesome Nonsports Products Sold Though a Sports Platform • When Appropriate Segment Is Targeted • When Non-Targeted Segments Are Reached • Examples of Unwholesome Products • Alcoholic Beverages (Miller Lite Beer and the NFL) • Tobacco Products (Marlboro and Indy Car) • Products of a Sexual Nature (Viagra and MLB)

  10. Distribution Decisions • Franchise Mobility • Loyal Fans Even When Overall Support Is Low • Team Moves because of Financial Incentives

  11. Distribution Decisions • Taxpayer-Funded Venues • Billionaire Owners with Millionaire Players • New Stadium May be Required to Keep Team • Taxpayers “Held Hostage” • Better Ways to Spend Tax Moneys

  12. Distribution Decisions

  13. Pricing Decisions • Ticket Prices • Fan Cost Index Documents High Cost • Focus on Corporate Ticket Buyers • Exorbitant Prices for Special Events • PSLs • Personal Seat License • Permanent Seat License • University Contribution

  14. Examples of University PSLs

  15. Pricing Decisions • Pay-per-View (PPV) • When Event Moves from Free to PPV Format • Will Mainstream Events Go to PPV Format? • Team “Scalping” of Tickets • Often Illegal for Individuals to Sell Tickets at Prices Exceeding Face Value • Some Teams have “Premium Ticket” Unit • Court Cases Ruled in Favor of the Teams

  16. Pricing Decisions • High Prices for Participation Sports and Athletic Shoes • Greens Fees • Ice Time • Shoes Endorsed by Popular Players

  17. Promotion Decisions • Overcommercialization • Proliferation of Event Sponsors – Olympics • Cluttered Sports Environment – NASCAR • Perception of Emphasis on Bottom Line • Naming Rights • Venue Names Often Ignored • Title and Presenting Sponsors

  18. Promotion Decisions • Signage Issues • Too Many According to Fans • Too Few Say Many Sponsors • Clean Stadia Concerns • Athlete Endorsements • Create Unrealistic Expectations Among Kids • Create Demand that Parent May Rebuff • Believed to Exert Upward Pressure on Prices

  19. Promotion Decisions • Virtual Advertising • Ability to Manipulate Environment • Ability to Block Out Actual Signage • Opportunities for Ambush Marketers • May Distract Viewer from the Action

  20. Broad-Based Controversies • Overstated Estimates of Economic Value • Estimate Used as Rationale for Investment • Governments Invest Millions on this Basis • Critics Doubt Investments Will be Recouped • Critics Argue Much of the Money Would be Spent in the Area Even without the Team, Stadium, or Event

  21. Sweatshop Production • Outsourced Manufacturing • For Example, Athletic Shoes in Vietnam • “Emergence of “Hate Nike” Web Sites • Led to New Policies at Some Universities

  22. Gender Equity • Title IX • Led to More Female Participants • Has Resulted in Cuts to Men’s Programs • Most Universities Have Compliance Officer

  23. Handling of Performance Enhancing Drugs (PED) • Steroids and Human Growth Hormones • Rules Against Use, But Penalties Have Been Relatively Mild • Have Leagues Condoned Use for Economic Reasons? • Recent Government Intervention

  24. Closing Capsule • Sports Marketers Have Many Critics • Questions Arise Regarding Each Element of an Organization’s Marketing Strategy • There Are Also Several Broad-Based Controversies Surrounding the Sports Marketing Environment

  25. Closing Capsule • We Market Through Sports • We Market Sports Products • It May Sound Easy, But It’s Not • As a Business, There Is A Focus on the Bottom Line – And the Industry Has Critics

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