Precision Marketing Chapter 3 Opening thought on careers in team sports marketing… “You may not be paid much (or anything) for the opportunity to break.

Precision Marketing

Chapter 3

Opening thought on careers in team sports marketing…

“You may not be paid much (or anything) for the opportunity to break into sports - and the real mistake is then giving the company what they are paying for. You should give them a $100,000 effort. You are trying to show that team that they can't live without you. Also, you should dress and act like you are ready to be promoted. Some of the best advice Jim Lites (President, Dallas Stars) gave me as a young man was to stop acting like the king of the single guys and start acting like a responsible man who could be trusted with more responsibility.”

Geoff Moore, Executive VP of

Sales & Marketing, NHL Dallas Stars

What do you need to know in this chapter?

1. Precision Marketing vs. Mass Marketing2. Viral Marketing3. Market Orientation4. How to collect demographic data5. How to collect psychographic data6. How to collect behavioral data7. Importance of Life Time Value (LTV)8. Issues in CRM implementation

#1 Precision Marketing vs. Mass Marketing

• Precision marketing offers customized benefits targeted to specific individuals based upon personal characteristics collected through the organization’s customer database.

• What makes a good viral ad? What kinds of emails do you like to forward to others?

• Consider the effectiveness of Super Bowl mass advertisements (www.superbowl-ads.com) vs. precision viral ads that direct customers online (e.g., www.subservientchicken.com).

• How would you compare the effectiveness of these two channels in terms of:– Waste?– Generating attention,

interest, desire, or action?

Read more about viral ads: http://money.cnn.com/magazines/fortune/fortune_archive/2006/10/02/8387416/index.htm.

#2 Viral Marketing

Viral marketing: “network-enhanced word-of-mouth.”

– If individuals receive electronic communications with obvious personal benefits, they will spontaneously pass the information on to others.

– The benefits might be economic, emotional, or social in nature.

– Combining all three benefits leads to high motivation to pass the message on to others.

How could you create a viral marketing campaign for your university’s tennis, baseball or softball team to:

Generate new fans,Enlarge attendance and purchases of

current fans, andMotivate and maintain current fan

loyalty and identification.

• Where would you get customer data?

• What would you offer in the email that would be passed on?

• How will you follow through in the campaign so that it moves fans toward higher levels of identification?

#3 Market-orientation

Market oriented organizations do three things effectively (Kohli and Jaworski 1993):– Generate customer

information– Disseminate customer

information, and most importantly,

– Respond to customer information in a way that meets customer needs and fulfills organizational goals.

Debate Question: Should Mark Cuban give fans open access via email to communicate with him?

• Split into teams (5 minutes prep time):

– Pro: Why is direct communication with Cuban a good idea?

– Con: Why is direct communication with Cuban a bad idea?

Mavs waive new uniforms after 1 game By Bob Velin, USA TODAY

The Dallas Mavericks' original uniform design lasted 21 years. Their latest shimmery silver road duds lasted one game. After a less than positive response following the uniform's debut opening night against the Los Angeles Lakers on national TV, the Mavs have decided to put the new unis in mothballs for now. Mavs’ Owner Mark Cuban received dozens of negative emails during and after the game, leading the team to discontinue the uniforms.

#4 Collecting Demographic Info

Demographic

Gender Male/Female

Age Year of birth: 19 ___

Marital status

Married/Single

Homeowner

Rent/Own home

Children Number of kids under 18 living at home?___

Heritage African-American, Caucasian, Hispanic, Asian, Native American, Other

Education High School or less, Some college, 2-Year Degree, BA/BS, Master’s, Dr/MD

Household Income

<$25,000, $25-49,999, $50-74,999, $75-99,999, $100,000+

Vicinity Miles you live from venue?

Zip Code(address)

Zip code:

Email Email:

Assume that you are gathering fan data for a team. You are responsible for developing the items that will be used on surveys and other registration materials to build their customer database. Identify the team you work for and answer the following:

1. What demographics would they want to have?

2. How exactly should these appear on the survey?

3. Where would you place these on the survey? (first, middle, last?)

4. How can this data be used by sponsors of the team in targeting their own customers? What kind of sponsors would be interested?

See example at: www.teamsportsmarketing.com/mavsgear.asp

#5 Collecting Psychographic Data

Psychographic How accurately do these statements describe you? (inaccurate—accurate)

Price Sensitivity (*tickets, food/drink, parking, team merchandise)

I am willing to make an extra effort to find low prices for *.

I will change what I had planned in order to take advantage of a lower price for *.

I am sensitive to differences in prices of *.

Social Motives

(can substitutefriends for family)

I go to the game to spend time with family as much or more than for the game itself.

I go to the game only if (some of) my family goes.

My family is the main reason I go to games.

Promotion-proneness

Promotions influence when I attend games.

Promotions play a big part in my choice to attend games.

If there’s a promotion I like, I just go to that game instead of another one.

Variety-seeking I enjoy going to different entertainment spots for the sake of comparison.

If I have a choice when I go out, I’d rather try someplace new than go to places I already know.

I tend to go to a lot of different entertainment spots, just for the sake of a change of pace.

Assume that the team is interested in learning about guests’ perceptions of:

1. The area surrounding the stadium or arena

2. The quality of the stadium/arena

3. The availability & usefulness of event information

4. Hotel packages—perhaps bundled with game tickets & parking pass

5. Public transportation

6. Prices of tickets

2. How do you think fan responses might differ dependent upon their:

• Price-sensitivity

• Social motivation

• Promotion-proneness

• Variety-seeking tendencies

#6 Collecting Behavioral Data

Behavioral How frequently do you use the following media to find information about the team? (not at all—very frequently)

Information-gathering

Newspaper (list names or editions as needed)

Radio (list stations)

Television (list stations)

Internet (team website or emails)

Signage at/near stadium

Magnet or pocket schedules

Consumption-Usage

How many games did you attend last season? (____/N)

How many games have you attended (will you attend) this season? (____/N)

When the team’s games are on TV, how frequently do you watch? (never—all the time)

When the team’s games are on the radio, how frequently do you listen? (never—all the time)

What seats do you prefer to buy? (list seat type and number of tickets desired)

How much did you spend on food and drink for yourself (not others) at this (last) game?

How much did you pay for parking at this (last) game?

How many team licensed logo items do you personally own? (1-5+) Apparel: Jerseys, shirts, sweaters, shorts, jackets, caps, jewelry,

etc. Home use: pennants, posters, signs, mugs, clocks, etc. Vehicle: license plate frames, license plate inserts, windshield

signs, etc.

1. What kind of behavioral data might the team and sponsors want to gather that would be useful in segmenting customers?

2. Why might the team be interested in finding out what other forms of entertainment sports fans enjoy?

3. How could this database be useful for CRM & precision marketing efforts?

4. How could the team make use of loyalty cards supported by a major corporate sponsor?

#7 Life Time Value (LTV)

Listening to and understanding the needs of loyal season ticket holders is critical to any sports organization’s success.

Organizations need to spend as much or more effort in maintaining and keeping their current loyal fans due to the life time value (LTV) of a customer.

To understand this concept, consider how much money you spend at your favorite restaurant, hair salon, dry cleaner, or other retail/service outlet while in college.

Pick one of these and write your calculations as follows:

• $_____ spent per week• X 50 weeks (you’re gone for at

least two weeks) = $_______• X 4 (or 5) years = $ ________

Some NFL teams have traditionally sold out of all of their season tickets. They have not had a CRM program. Why would they want to implement a CRM program?

Example of CRM Interface

#8: Issues in CRM Implementation

• As the team kicks off a CRM program, the individual in charge of the CRM implementation often encounters problems:

– Commitment: Can you get top management to fully support?

– Hardware match: Can the team make the appropriate investments in the right software & hardware?

– Healthy data: Can all sources of data be consistently categorized in the same way, avoiding duplication & errors?

– Measurement expectations: Can you avoid over-selling the program as the salvation for the team’s marketing problems?

– Change management: Can you deal with the natural reaction of those humans who prefer traditional marketing media—especially in this industry—when they have to change what they do to facilitate the CRM implementation?

– Right people on the CRM bus: Will the organization be willing to invest to get the best people for key roles to ensure success? Or will they just try to play with the hand that has been dealt? (i.e., current personnel)

– Sell & sell again: Can you continue the constant selling of the CRM program so that the organization continues to recognize its value in the success of its operations?