Hello class, hope all of you had a good weekend. Up to this point in the class we have been focusing primarily upon the different mediums of sports. We have focused on sports as entertainment and the many ways it can be brought to you. This blog will change our focus to the business side of sports and focus primarily on Sports Sponsorship and Chapter 18 of the handbook. Sports marketing is a billion dollar per year business and we are all subjected to it each time we watch a sporting event on television.
Working at Octagon, I get to see the creation of sport sponsorships from their earliest stages and how marketing agents go about targeting many different groups throughout the event they are sponsoring. Athletes can also be sponsored and this is very common. For example: Lebron James and Nike, Derek Jeter and Ford, Tiger Woods and Buick. Using athletes for sponsorship can be one of the most effective ways to target a specific audience. If you are a fan of the player being sponsored then you will instantly be focused on the commercial. (Or at least that is the theory)
My First Question to you guys would be: Have you ever bought a product because of the athlete that was used in the marketing campaign? Have you ever not bought a product because of the athlete in the campaign? (As mentioned in class before, this is particularly prevalent when dealing with NASCAR drivers. Fans of NASCAR will show major favortism to the sponsor of their favorite driver. It can almost be gauranteed that a Jeff Gordon fan will not buy any other paint besides Dupont.)
There is a large variety of brands and services trying to associate with sports. Many companies will expand their budgets in order to be associated with sports; particularly major sporting events as a result of the enhanced viewership. Some brands will even use sporting events as their cornerstone of their marketing campaigns. In 2004, sponsorship spending was expected to reach $11.14 billion with about 70% dedicated to sports events. Sporting events can be very expensive and selling sponsorship rights can help to fund the event as well as meet salary demands. As a result, the companies sponsoring an event will have their name placed in different mediums each time the sponsored event is mentioned; hence free advertising for the company. For example, I am a college football fanatic which brings me to my second question.
My second question to you guys is the following: For those who watch college football you will konw at the end of the season there is a "bowl season." Teams who have done well during the year will be invited by the bowl to play in their game. Each bowl is sponsored by a certain company. (Fed Ex Orange Bowl, Nokia Sugar Bowl, etc.) Do you guys think this is a good marketing strategy? Are there any sponsored events that stand out in your mind where you associate a particular brand or service with? (Example: Golf has the Buick Open) Would you be more apt to buy a product because you have seen it so many times during that sporting event?
As a side note to the question above: The reason certain events are sponsored by certain brands and services is because the event depicts the target market for that particular brand or service. Do you guys find this be accurate? For example, do you feel that Buick's biggest market would be golf fans? Are there any other events that stand out to which you feel greatly inhibit the market they sponsor?
One final reason that sports sponsorship is so extensive is because it provides an avenue for certain industries to get around television restrictions. Tobacco and Alcohol are the second and third largest sports event sponsor brands. There are advertising limits on tobacco and alcohol, but due to their sponsorships, they can have "incidental" recognition of their brands which can not be prohibited. Many people call this exploiting the sponsorship and find this as a way to promote underage consumption of alcohol and smoking.
Final Question: Do you guys feel (though not feasible) there should be restrictions of what alcohol and tobacco companies should be able to sponsor and how many sponsorships they can have??
Here is an article pertaining to a large sports agency which was once predominantly a talent agency (CAA) gaining sponsorship rights to a sports team: http://www.sportsbusinessjournal.com/index.cfm?fuseaction=article.main&articleId=56554
Here is a second article with a link to a commerical to which an athlete is used in a commercial to promote a certain product: http://youtube.com/watch?v=aXSQy2ATQxk
Feel free to answer any of the questions, certainly not all of them as there a lot. Hope you all enjoyed your weekend.
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2 comments:
I've never bought a product because of the athlete, but it does affect my thinking of the product a little bit. An example of this for me is that I have always thought Nike was the best shoe brand, above competition like Reebok. Part of that of course has to do with how the shoe looks, but I think when you see the best athletes signing contracts with Nike above Reebok or others then it makes you think Nike is the top of the class. As Rick mentioned, Lebron James and Nike is a good example. He had the chance to sign with any shoe company he wanted to. I think he even could have gotten more money from Reebok, but he chose Nike. Now he is the face of Nike, and he is my favorite player, so I think whether to a certain extent that makes me favor Nike more.
I think the college football "bowl season" works tremendously for advertisers. Alot of college football fans identify some bowls based on the advertiser's name, especially for some of the lower bowls (ex: galleryfurniture.com bowl)I immediately match up Fed Ex with the Orange Bowl, and Nokia with the Sugar Bowl. It is almost second-nature at this point because I have just gotten used to those sponsors for those bowls. It doesn't make me personally want to go out and buy Nokia or use Fed Ex any more though. With those brands all over those big bowl games, though, it kind of drowns out their competition from my mind, atleast for the day.
It's not so much that I identify other events with sponsors, as much as at this point I identify stadiums with the sponsor's name. I don't know if we will be talking about stadiums later in the semester, but being from New Jersey, I have known Continental Airlines Arena for a long time. That will be changing soon to the Izod Center, a clothing company. Having a stadium name is one big advertisement for a sponsor. There is the American Airlines Arena, Allstate Arena, basically every arena these days is having a corporate sponsor's name attached to it. In my opinion this is more effective than sponsoring an event, because every game people go to they will see the company's name. I think this has kind of taken away from the mystique of stadiums, but it really is 99% about money these days. Giants Stadium, the Boston Garden, Chicago Stadium, those were all classic stadiums. Now the new stadium for the Giants will have a corporate sponsor's name in it, the Celtics play in the Td Banknorth Garden, and the Bulls play in the United Center.
I personally have always found advertising to be a bit "overrated" in a sense. This may not be true for lesser known brands because they need to get their name out there. But when we are talking about Nike and Buick, as Rick mentioned, i really don't think having a star athlete makes that big of a difference. I have never bought a product because a celebrity endorsed it. This is because i just know that they are being paid and what they are saying is written for them. I could be wrong, but i am pretty sure Derek Jeter doesn't actually drive a blazing copper Ford Edge. I buy a product because of factors like quality, style and price.
As for college football, those bowls generate so much money for the teams and the sport, so I cant argue with that. But again, I would never buy a Nokia phone just because they sponsor the Sugar Bowl. Even though it is great publicity for Nokia to have their name out there, i don't really see sales increasing because of it. This might not be the case for lesser known companies, as Ron mentioned. They do need the publicity and people might be willing to try a product or a website if they have never seen it before.
I don't think companies sponsor events so much because they feel the event involves members of their target market as much as they just want their name out there. Golf is a very prestigious, high class sport and i don't think Buick is the most popular automobile driven by the fans and players of golf. But it is a good way to get the brand name out and to let people know that Buick is still a force in the market. But on the other hand, i worked for a company that helped set up the AVP Pro Volleyball Tourney at the Jersey Shore. The main sponsor for AVP is Crocs. Now that demographic really would be into a product like Crocs and since they started sponsoring the tour, Crocs have really become popular. So it can go both ways.
Overall though i really feel like when big companies advertise and sponsoring events it is more so for the "swagger factor" then anything else. The Super Bowl is a great example. Coke pays millions of dollars to advertise during the Super Bowl, even though everyone knows Coke already. I feel like if you like Coke you will drink it regardless of advertising, and if you like Pepsi, you aren't going to just switch to Coke because of some cute Polar Bears. These big brands just want to show their power and market dominance. But nonetheless, advertising and sponsorships is big business and will continue to be despite anyone's opinions. Just like all the mediums we mentioned before in class, sports goes hand in hand with business.
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