SPTE 380 Lecture 7Last Lecture:Chapter 5: Market SegmentationObjectives• To appreciate the essential role of segmentation in the marketing process in order to match the right product offer to the correct target• To recognize the standard bases of market segmentation in sportMarket Segmentation Defined• The process of dividing a large, heterogeneous market into more homogeneous groups of people who have similar wants, needs, or demographic profiles, to whom a product may be targetedPurpose of Segmenting• Specialize• Focus on those most likely to buy• Meet wants and needs without exhausting resources• Provide product, price, promotion, place, and public relations in the right way• Identifiability, Accessibility, Responsiveness• Identifiability: Can the marketer identify a segment? • Accessibility: Can the marketer access the segment?• Responsiveness: Will the segment be responsive to marketing efforts in terms of wants and needs, and is it worth targeting the segment?Four Bases of Segmentation• State of being• State of mind• Product benefits• Product usage• State-of-Being Segmentation• Geography• Age• Income• Education• Gender• Sexual orientation• Race and ethnicityThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.State-of-Mind Segmentation• State-of-mind segmentation assumes that consumers may be divided by personality traits; by lifestyle characteristics such as attitudes, interests, and opinions; and by • Values and lifestyle (VALS) typology– Innovators– Thinkers – Achievers – Experiencers – Believers – Strivers – Makers – SurvivorsProduct Benefits Segmentation• What does the customer want from the experience or product?– Socialization– Excitement– High performance– Entertainment– Affordability– Affirmation– RecognitionProduct Usage Segmentation• Sport marketers need to understand that their consumers can be segmented based on how much they use the product. – Common divisions include heavy, medium, and light users.– 80-20 rule: 80 percent of business comes from 20 percent of the customers.– Repeat business is the key to success (e.g., season-ticket holder versus single-game attendee).• Not all consumers consume at the same rate.• The level of consumption varies from sport to sport, so the relative importance of usage rates (in terms of total attendance or participation) differs from sport to sport.• The levels of consumption are likely to vary from age group to age group.• The sport marketer must maintain opportunities for consumers to consume at many usage levels. • An increase in sales volume is much more likely to be generated by increased frequency or a higher consumption rate of existing users than it is from an increase in sales to first-time users.User Group Segmentation: Spectator• Unaware: nonuser • Aware: nonuser consumer • Media consumer • Light user • Medium user • Heavy user• DefectorIntegrated Segmentation Strategies• After consumer data is collected, it must be assimilated into the sport marketers’ overall strategy.• Collating or merging data takes work but paints a more detailed picture of consumers, which in turn allows marketers to make better strategic decisions.Use of Database in Segmenting• State of being• State of mind• UsageBenefits• Manipulated to specify approach to different segments (promotions)• General letter versus invitation to personal saleCurrent Lecture: Managing Sport Brands ObjectivesTo understand the scope and importance of brand management and branding in the sport settingTo demonstrate an understanding of how brand equity is developed in a variety of sport settingsTo identify and discuss the sources of brand associations for teams, athletes, agencies, and othersport entitiesWhat Is Branding?The brand name and marks associated with a sport organization (such as a logo) serve to providea point of differentiation from the other sport products that exist in the market place.The brand name, logos, marks, and colors of a sport organization serve as a starting point in the brand management process.Sport brands trigger feelings and attitudes toward a particular sport product that have been developed through sport consumption.Brand EquityDefined as “a set of assets and liabilities linked to a brand, its name and symbol that add to or subtract from the value provided by a product or service to a firm and/or that firm’s customers.”When a sport organization is able to achieve a strong image in the consumer’s mind, it realizes brand equity. Benefits of Brand EquityLess drastic revenue declines when the team losesAbility to charge price premiumsMore corporate interest Licensing and merchandising opportunitiesDeveloping Brand EquityThe creation of awareness about the brand: the ability of a consumer to name the brand’s existence when its product category is mentionedThe creation of a brand image:Cumulative effect of all associations with a particular brandDevelopment of unique, strong, and favorable brand associationsSources of Brand Association with TeamsLogo, marks, nickname, and mascotOwnerPlayersHead coachesRivalriesEntertainment package surrounding the game or eventStadium or arena in which a team playsAssociations Formed Based on the Benefits of ConsumptionNostalgic Social Identification with a team Identification with a cityBrand Associations in Other Realms of SportSponsorsAthletesAgenciesHealth clubsBrand Association Formation for SponsorsMany companies sponsor sporting events or teams to enhance or reinforce the brand associations with their company in hopes that the brand equity of the sport event or team will transfer to the company.The image of a sport entity can help create strong, unique, and favorable associations for the sport brand.Brand Association Formation for AthletesBecause professional athletes can make money from corporate endorsements, having strong, unique, and favorable associations is important for an athlete. Athletes can create strong positive or negative associationson the playing court or field oroff the playing court or field.Brand Association Formation for AgenciesAlthough they are visible behind the scenes, agencies are not visible to the sport consumer. Associations are created throughthe clients they represent, people who work for them, andarea of