distribution concepts ability of consumers to gain access to products in a timely and convenient...

Distribution Concepts

• Ability of consumers to gain access to products in a timely and convenient fashion

• Moving product from producer to consumer via the various channels of distribution

Sports Distribution Issues

• Sports Retailing

• Stadium as “Place”

• Sports Media

Sports Retailing Mix

• Products

• Pricing

• Distribution

• Promotion

Retail Image/Store Personality• Factors include (in general):

– atmospherics

– location

– employees/sales personnel

– clientele

– merchandise assortment

– promotional activities

Stadium as “Place”

• New Sports Venues

• Ticket Distribution Issues

Sports Media as Distribution

• Delivering the Sports Product to Consumers Via Media

• Rising Cost of Media Rights

• Media as a Portion of the Revenue Mix

• New Trends in Sports Media

Pricing Concepts• Price is a Statement of Value

• Value = Perceived Benefits

Price of Sports Product

• Essence of pricing is the exchange process - An attempt to quantify the value of what is being exchanged

Internal and External Determinants of Pricing

Internal• Product • Promotion • Distribution• Cost• Organizational

Objectives

External• Consumer Demand• Competition• Legal • Economy• Technology

RELATIONSHIP OF PRICE TO SOME OTHER MARKETING MIX ELEMENTS

• Related to product life cycle• Communicates something about the product• Promotion geared towards information

about price• Product lines with different prices attract

different segments of consumers

Estimating Consumer Demand

• Consumer Tastes

• Availability of Substitute Sports Products

• Consumer Income

Pricing Strategies

• Differential Pricing Strategies

• New Sports Product Pricing Strategies

• Psychological Pricing Strategies

• Product Mix Pricing Strategies

• Cost-Based Pricing Strategies

Differential Pricing

• Second Market Discounting

New Sports Product Pricing

• Penetration Pricing

• Price Skimming

Psychological Pricing

• Prestige Pricing

• Referent Pricing

• Odd-Even Pricing

• Traditional Pricing

Product-Mix Pricing

• Bundle Pricing

• Captive Pricing

• Two-Part Pricing

Cost-Based Pricing

• Cost-Plus Pricing

• Target Profit Pricing

• Break-Even Pricing

Price Adjustments

• Price Reductions and Price Increases

• Price Discounts

Implementation Issues • Communications• Staffing Staffing and Skills• Coordination• Rewards• Information• Creativity• Budgeting

Strategic Control Issues

• Planning Assumptions Control

• Process Control

• Contingency Control

Planning Assumptions Control

• “Are the premises or assumptions used to develop this marketing plan still valid?”

• Examine the external environmental factors and the sports industry factors

Process Control

• Monitoring Strategic Thrusts

• Milestone Review

• Financial Analysis

Contingency Control

• “How can we protect our marketing strategy from unexpected events or crises that could affect our ability to pursue the chosen strategic direction?”

• Developing a Crisis Plan

Growth of Sports Industry

• The sports industry generates estimates of 213 to 350 billion dollars per year in revenues. As ESPN founder Bill Rasmussen points out, “The games are better, and well the athletes are just amazing and it all happens 24 hours a day. America’s sports fans are insatiable.”

• Attendance is increasing:– The NFL experienced a record number of fans in the 1999 season (15,710,970)– The NBA 1999-2000 season also produced a small increase (1%) for the NBA– MLB reached 20 million fans faster than any other year in history and attendance

increased again (3%) – NHL continues to grow in attendance and popularity. Tracing average attendance

over the past few years, regular season numbers have increased from 14, 749 (‘93-’94) to 16,359 (‘99-’00)

– NASCAR had 11 million people attend its events in 1999

• Sports Sponsorship Spending Exceeds $1 Billion Dollar Mark• New Leagues (AF2, XFL, WPFL, WSA, WNHL)