Different Forms of Sport Marketing: A Simple Overview

Sport marketing comes in many different forms which means it is therefore very important that athletes, organisations and businesses understand that not every opportunity that presents itself will suit the individuals organisations and companies involved.

Once you are over the initial shock of being asked to promote a product, be the ‘face of’, represent a company and so on, you need to understand what it is you are actually bound to do in accepting these ‘free’ goods and maybe services.

The seven main forms of sport marketing can be identified as advertising, endorsements, corporate hospitality, merchandising, intellectual property rights and possibly the most common form is sponsorship. Quite often athletes will wrongly think, that they are being sponsored when, in fact, they are just being utilised effectively by the company.

In this article we will briefly consider the core differences between advertising, endorsements, corporate hospitality and merchandising.

Advertising involves athletes and sport organisations when they, or their likeness, is participating in a campaign. Historically advertising is split into two sections: above the line advertising and below the line advertising. If you know the difference you will know that your involvement should command a completely different price bracket because the two types of advertising cost different amounts. It is also becoming increasingly important for athletes to know through which marketing channels the advertising will be broadcast. If, for example, you star in a TV campaign you will have a far greater reach than if you star in a local magazine. The reach of your presence will differ, so will the awareness and possible return for the company using you or your likeness. Social media is now added as a channel and it is worth knowing at all times where you or your likeness are active on the social media scene. If you are aware you can anticipate any conflicts of interest, over exposure, message and level of personal involvement in any campaign.

Endorsement deals are where you agree to be associated with a product or service in the public eye. Probably one of the most famous deals is that of Don Carter who secured himself, in 1964, a deal worth USD $1million with bowling manufacturer Ebonite. This deal far outstripped his closest rival, the golfer Arnold Palmer, who four years previously had agreed a USD $5000 per year global deal with Wilson. It is important to suit and understand the brand whilst the key for the brand you are endorsing is getting the core of the campaign right first then hiring the right athlete to do the job. It is worth remembering not to align yourself with too many brands as you will become an ineffective ambassador and also remember to be honest with what you would like to receive in return for endorsing a product or service. It is of paramount importance to consider how the endorsement will positively and negatively affect your future. The key to being an endorsement king or queen is to know yourself and know your brands.

Corporate hospitality is growing as fast as the sport industry grows. Athletes and sport brands use each other effectively to create opportunities of exposure in this business environment. Brands often like the opportunity to associate with a sporting event. Corporate hospitality at a sporting event can create a presence with likeminded customers or, of course, introduce the brand to a completely new type of customer. There are many smaller appearance opportunities for athletes within the remit of corporate hospitality. It is well known that bigger stars are paid to attend events run by companies to add ‘wow’ factor. One of the most prestigious endorsement deals in England is the Nike box at Twickenham which has run consecutively for a number of years raising the value each year of corporate hospitality boxes at the home of England rugby.

Merchandising is becoming an integral part of sport marketing. Most sporting clubs sell branded products. These products range from the obvious and ordinary right through to the sublime. A great example of merchandising is of course football clubs as they know that they have to look at customer spend and offer products that range in a variety of price brackets. The beauty of merchandising allows for fans to take away a memory of their day at an event and of course spreads the word of the brand. Merchandising is an especially lucrative form of action communication and has a target market and often a captive audience. Brands must remember however that merchandise is often cause and effect based. With the 2014 FIFA World Cup looming you will notice that all the major supermarket chains are creating their own merchandise, which although in most cases, is not official, it creates an attachment to a sporting event. This allows for the stores to trade on consumer fan loyalty by making emotional rather than required purchases.  Of course not every item is appropriate and quite often items will be withdrawn from sale or defended by the brands as they are viewed negatively by the greater public. The recent Asda merchandise has caused concern both in print media and social media. 

Being attached to brands is a wonderful way for athletes and organisations alike to sustain themselves in a volatile environment if nurtured and understood. However as agreements and attachments to brands become more complex, as sport becomes more popular as a tool for products and services to air their business to new and established target audiences  it is vital that everyone involved knows exactly what is being agreed to and that all parties to the agreement understand the terms, restrictions and conditions imposed upon them.

In the next article of this series we will look at sponsorship, intellectual property rights and suggest ways of identifying which marketing tool(s) will help you sustain your brand.

Should you require individual advice please don’t hesitate to contact us by email (info@tacticcounsel.com) or by telephone (01403230751).

Written for MindMuscleCXN
First published by MindMuscleCXN
December 2014

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