Where did UGA get the “Power G” from
The Green Bay Packers
Who wanted UGA to adopt the Power G
Vince Dooley
Subliminal Messaging
Words, images, or sounds in television, commercials, music, and digital media–to boost sales of products and services
8 UGA Brand Attributes
Innovation
Tradition
Pride
Excellence
Championship
Class
Family
Competitive
PICTCFC
What dfoes every team and individual athlete need?
Competitors
What was the one thing that changed everything about sports and how owners, coaches, and AD's think about sports?
HD TV; Incentivizes fans to watch at home
Conjoint Production
Requires at least two producers
Conjoint Consumption
Sports fans commonly engage in this sport experience is usually far better when one watches a game with others
What is a challenge for sport business leaders?
Understanding what will maximize the benefits received by fans (consumers)
(Fill in the Blank) Sport Managers must create a (Public/Private) experience to satisfy (Luxury/Non-Luxury) seating while ensuring other fans are willing to attend in (Luxury/Non-Luxury) seating
Private;Luxury;Non-Luxury
What happens when general seating gets pushed too far away from the field of play?
The value of those seats reduces
What do individuals and corporate fans want to see and enjoy?
Want to see a winning team and want to enjoy amenities of new and well maintained facilities
Will fans pay to see a marquee player, even if past prime?
Yes
Demand
Defined as the relationship between price and quantity of product
Law of Demand
States that when prices increase, consumers will want less of a good
What do movements upward on the demand curve indicate?
Imply there is more demand for good or services
What do movements downward on the demand curve indicate?
Highlights less consumer interest
(T/F) Sport Organizations will focus on things besides price that help teams increase DEMAND
True
What do teams produce?
Produce games, merchandise, and fan experiences. Focusing on demand for games which is reflected in attendance and TV ratings
What categories can overall attendance be broken down to?
Victories, exciting games, and fan experiences inside the stadium
(T/F) The Cubs fan experience is not great enough where they still sell plenty of tickets when the team is not performing well
False, they sell lots of tickets regardless of team performance
What is a nickname of the Cubs when they do not play well?
Lovable Losers
5 Factors that Affect Demand
Fan Tastes and Prefrences
Fan income level
Population size
Price of subsititutes
Future expectations for the team
What is the biggest long-term factor of demand for a team?
It’s location
What is the fundamental question of long-term demand?
What will the market bear?
How do you go about answering the fundamental question of long-term demand?
First understand how much wealth exists to buy tickets, then place that demand in the context of the total supply of sports and entertainment produced for the region
Are recessions and booms easy or hard to predict?
Hard
What do wealth measurements indicate?
The size of the market and its potential to support teams and events required to pay for a venue
How much is the supply of tickets in New York?
13.7 Million
Given New York’s ticket supply, how many tickets do teams need to sell to each resident to ensure sellouts?
Less than 1
(T/F) Championship teams only sell out in certain markets
False; they sell out in all markets
How many tickets must cities with one team (jacksonville, san antonio) sell per resident to sellout their entire supply?
Fewer than .5 per resident
Who are the primary clients when teams look to sell luxury seating?
Businesses
Where are corporate payrolls the highest? (4 cities)
NY, LA, Chicago, DC
What cities have the highest average hossehold spending? (4 Cities)
Minneapolis, San Diego, Seattle, Denver
What city is best suited to sell general and luxury seating?
Chicago
Three definitions of market peneration rates
looking at its ticket sales relative to all tickets sold to sport and entertainment events in their market
looking at team’s total ticket sales as a percent of a measure of population (total population or sport fans, etc). Then would compare their region vs other teams in the same league in other regions
Helps illustrate the value of large markets. Large markets tend to have lower penetration rates than small markets, but often sold more tickets
What metric can be useful in understanding demand?
Market Penetration Analysis
What factors affect total sales?
Differences in tourism, historic ballparks, new facilities
What is market penetration analysis used to assess?
Popularity of a single product
(T/F) Higher population allows a lower price to be charged
False; higher price
Do large markets or small markets tend to have a higher penetration rate?
Large markets
Do MLB teams have more or less attendance if another team is nearby?
Less
Short-Term Demand Factors (6)
Attendance
Winning
Other factors
Superstars, offense
Marketing
Competitive Balance
Television
MWCOAT
What are differences in demand related to?
Number of games played and day of the week
Are MLB or NFL teams more likely to play before a sellout crowd
NFL
What is the fastest way to increase demand for tickets in the short term?
Winning
What does winning create for the next season?
High expectations, so more tickets sold at the beginning of the next season
What type of fan does winning create
A loyal fan
Is a win worth more for a good team or bad team
Good team
Is fandom for women more or less dependent on age?
Less
Fan loyalty for males is created from what ages?
8-12
Does a big name player have a big or small effect on attendance
Small
What is the exception to teams with superstars not performing well not selling many tickets
Michael Jordan on the Wizards
What leagues limit foreign players due to decreasing attendance?
CFL and European Basketball
NHL example of increasing offense
Reducing goalie pad size
Basketball example of increasing offense
Adding the shot clock
NFL example of increasing offense
Limiting touchbacks for more returns
Do teams with the same players have higher attendance than teams that turn over players more often?
Yes
Who is the father of sport marketing
Bill Veeck
Examples of Bill Veeck’s marketing genius
-Played a 3 foot 7 player
-Fans voted on managerial decisions
-Started fireworks after hr’s
Who implemented marching bands at what school?
Newt Rockne, Notre Dame
If a home team’s winning percentage increases by .1, how much do their TV ratings increase by?
1.8
What is the most important decision organizations need to make?
Pricing
What two SEC schools overbuilt premium seatings to try to make more money, but were hit with the recession?
Tennessee and Florida
How do teams price tickets?
Estimate demand and then price tickets accordingly to be sure that the maximum number of fans will attend
By what % did Red Sox tickets increase by over nearly 20 years?
470%
What company produces the Fan Cost Index
Team Marketing Report
Fan Cost Index
Measures average cost to take a family of four to a single, regular season game in an average seat
Who sets the price of tickets
The team
Who brokers TV deals for NFL teams
The NFL
Who brokers TV deals for college football
THe conferences
Is ticket revenue shared in the NFL
YEs
Is ticket revenue shared in CFB
No
3 Effects of Raising Ticket Prices on Profit
Increase in price increases the cash inflow per ticet sold
At higher prices, teams will sell fewer tickets, which decreases cash inflow
Higher prices will decrease costs because there are fewer fans
What factors do teams weigh when considering raising ticket prices
Per ticket gain and feared decrease in number of tickets sold
Until what point will teams raise ticket prices
Until the benefit of increasing price equals the cost of raising prices
Does raising ticket price affect attendance
Not really
What game did a ticket seller claim to have tickets but fans never recieved them
UGA Rose Bowl
When is ticket pricing inelastic
When prices are too low, say a price increase will have a relatively small effect on quantity sold
When is ticket pricing elastic
When prices are too high, a price increase will have a large effect on quantity sold
Unit Elastic
If the price is such that a 1% increase causes a 1% decrease in quantity
Factors that make ticket prices inelastic (5)
Concessions
Advertising/Sponsorship Sales
Larger Fan Base
Increase Television Ratings
Team Image, Reputation, and Goodwill
CTAIL
Price Discrimination
When firms change different customers different prices for identical goods
Benefits of Student TIcket Discounts (4)
University model. Not fair to pay on top of tuition
Students develop deeper allegiance to university when go to games
Have less disposable income, so have lower demand
They are future season ticket holders
What school was the first to implement 10 a year?
Clemson
Product Bundling
Sellers are willing to sell at a discount if the buyers commit to buying multiple items
Example of a perishable good in sports
An empty seat
Most common items to bundle
Parking and concession
What MLB team has all you can eat
Dodgers
Does product bundling have strong or weak marketing advantages
Strong
What does the best approach depend on
the price elasticity of consumers who buy tickets early vs those who do it late
Is demand elastic on inelastic: If fans who buy tickets early are your most dedicated and don’t want to miss
Demand is inelastic and change in price won’t change quantity sold
What MLB team rewards fans for buying tickets in advance with lower prices
Orioles
Dynamic Pricing
Prices shift depending on shifts in demand
If sales are high for a game and there are few seats left, prices for that game will increase. If sales are lagging, price will decrease
Drawback to Dynamic Pricing
some fans resent the fact that others paid less for their tickets
What University has auction pricing and what do they call it?
Northwestern; Purple Pricing
PSL
Fans have the right to future season ticket packages and sometimes a discounted ticket price. Those who do not buy a PSL pay a higher price
When are PSLs often sold
Before a new facility is built so a team has more upfront money
What league are PSLs most common in
NFL