Monika Main Final

7/28/2019 Monika Main Final

1/59

A

PROJECT REPORT

ON

SPORTS MARKETING IN INDIAN PERSPECTIVE

IN THE PARTIAL FULFILLMENT OF THE

MASTER OF BUSINESS ADMINISTRATION PROGRAM

2012-2013

DEPARTMENT OF MANAGEMENT STUDIES

SHRINATHJI INSTITUTE OF TECHNOLOGY AND ENGINEERING

UPALI ODEN, NATHDWARA.

SUPERVISED BY: SUBMITTED BY:

DHAWAL BHATT MONIKA SANADHYA


2/59

DECLARATION

I MONIKA SANADHYA the student of M.B.A Part II From Shrinathji

Institute of Technology & Engineering gravely declared that the content

of this project is an original one and same part has not been submitted

earlier to this institute or any other institution for the fulfillment of the

course of study.

MONIKA SANADHYA

M.B.A II


3/59

ACKNOWLEDGEMENT

I express my sincere thanks to MR. DHAWAL BHATT Assistant

Professor of (S.I.B.M) for guiding me in doing this project.

I also express thanks to Almighty God, my grandparents and parents for

giving me full support with their blessings.

In preparation of this report, material has been drawn from various

resources. We wish to acknowledge these inputs as starting point of the

report and indebted to the creators and producers of the same.

Lastly I want to thank my typist for printing my report on time.

Thanks to one & all.


4/59

SPORTS MARKETING: IN INDIAN

PERSPECTIVE


5/59

CONTENTS

CHAPTER 1: INTRODUCTION

CHAPTER 2: REVIEW OF LITERATURE

CHAPTER 3: RESEARCH & DEVELOPMENT

CHAPTER 4: DATA INTERPRETATION

CHAPTER 5: CONCLUSION and SUGGESTIONS

BIBLIOGRAPHY


6/59

CHAPTER - 1INTRODUCTION


7/59

INTRODUCTION TO THE REPORT

Some sporting goods companies have preferred to invest first in the

larger and more mature Chinese sporting goods market, but they have

often stumbled against strong local competition and some cultural

hurdles. The Indian sporting goods market has its hurdles, too. It is

currently smaller and less developed, but foreign entrants enjoy the

advantage of lower local competition, greater respect for intellectual

property rights by local producers and a widespread knowledge of the

English language. Furthermore, the Indian sporting goods market may be more rewarding in the longer term because of demographic and

other trends.

A figure of just over 500 million a year has been recently aired for the

size of the branded Indian sporting goods market, making many

executives in the industry wonder whether they should really make a go

for it, but this figure doe snt give an accurate picture of the actual

size of the market or its potential. The more thorough research that we

have conducted in the past six months indicates that the market is

probably five times bigger based on a broader definition, like the one that

we adopted for Russia, and that it is growing very fast, partly

Under the impulse of a strong new nucleus of modern, western-

oriented sporting goods retailers who are looking for foreign sports

brands as alternatives to the majors.


8/59

CONCEPT OF SPORTS MARKETING

Marketers might have it wrong: in a time when consumers are hunkering

down in a challenging economy, they yearn for the community of localsporting events rather than the big national sports advertisers gravitate

toward. Why? Simply put, its getting harder and harder for a family to take

in an NFL, NBA or MLB game without blowing the budget. However,

sports are still important to Americans of all ages, and that creates an

ideal marketing and corporate sponsorship opportunity for small and mid-

sized college conferences and athletic programs. But to capitalize on this

new-found opportunity, conferences and athletic departments must be

able to speak the language of potential sponsors in a professional, value -

added manner.

What does that mean? Simply put, Clear Marketing Concepts provides

conferences and colleges a comprehensive marketing and corporate

sponsorship strategy designed to generate additional revenue. If youreready to generate additional revenue for your conference or athletic

department, Clear Marketing Concepts can provide the guidance and

expertise necessary to help you achieve this goal.

As a matter of fact, we have run into numerous sporting goods suppliers

who have entered the Indian market only in the last few months, anxious

to team up with the most promising partners and to plant their seeds earlyenough to reap the benefits of market entry ahead of their competitors.

They have been partly attracted by the sheer size of the Indian

population, its rising middle class and the fast-growing economy of the

country.


9/59

WHAT IS SPORTS MARKETING:-

So just exactly what is sports marketing? Why is there such interest in

entering this field? By definition, marketing is creating an environmentwithin which a sale can be made. By adding the word sport to that

equation, it becomes the environment for application of marketing

techniques. And the business of sport is BIG business. Industry estimates

range from $25-50 billion dollars depending on how you calculate the size

of the industry.

The business of sports (or sports marketing) is made up of distinctsegments. The major elements are as follows:

Rights Holders

Broadcasters

Facilities/Venues Promoters

Buyers/Sponsors

Agents/Athletes

Event Management/Operations

A brief review of these segments reveals the unique interaction and, to a

large extent, interdependence of these diverse groups of people, eventsand buildings.

Rights Holders include entities such as; the International Olympic

Committee, NFL, NCAA, Major League Baseball, National Basketball


10/59

Association, United States Olympic Committee and others. These

organizations own and control events (competitions), which have value to

television broadcasters. Television broadcasters in turn, bid for the right to

telecast these events and many times bid against each other for theprogramming rights, thus driving up the revenues (rights fees) to the

Rights Holders.

Broadcasters then package and promote the events to a television

audience and they count on advertisers to pay fees for commercial time

when the broadcast is aired. Profit on these broadcasts is usually

substantial, thus justifying the fees paid by the networks.

Facilities/Venues are required to stage the events and the host team or

facility also needs to make a profit. This model is particularly evident in

professional sports where the local team sells in stadium advertising and

tickets and, on occasion, local broadcast rights, thus providing additional

revenue to the host team or facility or owner.

Promoters frequently create their own events. Don King has been the

consummate sports promoter by packaging professional boxing events in

large venues and negotiating television rights and signing the athletes to

fight for a large prize purse.

Buyers/sponsors pay enormous amounts of money to advertise their

messages on the air, in stadiums/venues, on radio and in hospitality at the

various events. The Olympics and NASCAR have been particularly

successful as corporate entertainment venues. Of course, one should not


11/59

ignore the Super Bowl, Wimbledon, the Kentucky Derby and other single

day events, as corporate entertainment opportunities.

And, in almost all cases, there are athletes that perform their artful craftin return for large salaries. Of course, these enormous salaries would not

be possible if not for the tremendous amounts of money paid by the

television networks. Virtually all of the professional athletes are

represented by agents, many of them attorneys, who negotiate salaries,

bonuses, deferred compensation packages, endorsements and other

fees in return for a percentage of the total fees. Many of the agents who

represent a large number of athletes have considerable leverage and

experience in this field and try to negotiate maximum fees while their

athletes (clients) are healthy and in their prime. The business of sports is

expected to get to about $2billion annually in India by 2015, riding on

the growth in the income from the TV media and sponsorships. India

would witness a sizeable surge in TV advertising and sponsorship

income in the near future, making it the second-best revenue generator after Brazil among BRIC, found the study conducted by global

consultancy giant Price Water house Coopers (PwC).The study also

says that the sports revenue in India would see an average annual

growth of 5 per cent to reach a level of $1.89 billion in 2015 and that

the sports industry revenues are based on four factors i.e. gate

(generally referred for ticket sales), sponsorship deals, media rightsand merchandising to a certain extent. Corporate sponsorship in India

for sports has not picked up in a big way, far from it , it constitutes only

1% of a global market estimated to be worth $40 billion, according to

sports & entertainment marketing company Octagon. Starcom, the


12/59

media arm of Publicis, one of the world's largest advertising

conglomerates, plans to launch its sports marketing division 'Relay' in

the country. Top B-schools are considering having electives on Sports

marketing feeling the need for students to understand sports marketing.

Finally, none of the events can be staged without facilities. Management

and operations of the sports venues is a business in itself. The sale of

tickets, licensed merchandise, food and beverage and other operational

tasks, generate revenue and create a sense of excitement around the

events. In the case of the Olympics, these local organizing committees are

created for a short duration during which they create their own

infrastructure, rent facilities, organize competitions, sell tickets, stage

events and then effectively go out of business, all in the span of

approximately six to seven years.

All of these areas collectively and individually make up the sports

marketing industry. And within these areas are additional elements, suchas shoe, equipment and apparel manufacturers, licensing companies, food

and beverage vendors, advertising agencies (who create unique

commercial messages in association with sponsorship and television

broadcasts), public relations companies (who try to position their

clients/sponsors as good corporate citizens and many other supporting

players.

It is easy to see how the industry has grown over the years. All one has to

do is analyze how much sports programming is offered on over the air

(network) and cable television broadcasts. Since the incredible financial


13/59

and aesthetic success of the 1984 Olympics in Los Angeles, there has

been a proliferation of sports programming, sponsorships and events.

Rights fees continue to rise and sponsors continue to pay higher andhigher fees for the right to associate themselves with these big events and

the athletes who compete in them. It does not necessarily follow, however,

that this growth will continue unabated. There are signs that this trend has,

at the very least leveled off and may be in a slight decline. Television

ratings for all professional sports has been down in recent years and many

professional franchises are struggling financially.

However, the sports marketing industry remains an important and viable

part of the national economy and consciousness in this country and,

indeed, worldwide. World Cup Soccer, the Winter and Summer Olympics,

Alpine Skiing, Formula One Auto Racing and other events are highly

viewed by global audiences. That is why large multinational companies

like Coca-Cola, VISA, Kodak, XEROX and others continue to sponsor these events.

With a large industry such as the sports marketing industry, the real

question is where do you fit in? Well address that topic in future articles.

Until then, maybe you can decide where the best opportunities are within

this multi-billion dollar industry. Good luck!

Copyright (c) 2002 - 2010 United States Sports Academy. All rights

reserved. All submitted material, once approved by the Editorial Board and

published, becomes the property of The Sport Digest . Reproduction in

whole or in part without written permission is strictly prohibited, with the


14/59

exception of acknowledged references in scholarly material (less than 200

words).

So just exactly what is sports marketing? Why is there such interest inentering this field? By definition, marketing is creating an environment

within which a sale can be made. By adding the word sport to that

equation, it becomes the environment for application of marketing

techniques. And the business of sport is BIG business. Industry estimates

range from $25-50 billion dollars depending on how you calculate the size

of the industry.

Rights Holders include entities such as; the International Olympic

Committee, NFL, NCAA, Major League Baseball, National Basketball

Association, United States Olympic Committee and others. These

organizations own and control events (competitions), which have value to

television broadcasters. Television broadcasters in turn, bid for the right to

telecast these events and many times bid against each other for theprogramming rights, thus driving up the revenues (rights fees) to the

Rights Holders.

Broadcasters then package and promote the events to a television

audience and they count on advertisers to pay fees for commercial time

when the broadcast is aired. Profit on these broadcasts is usually

substantial, thus justifying the fees paid by the networks.

Facilities/Venues are required to stage the events and the host team or

facility also needs to make a profit. This model is particularly evident in

professional sports where the local team sells in stadium advertising and


15/59

tickets and, on occasion, local broadcast rights, thus providing additional

revenue to the host team or facility or owner.

Promoters frequently create their own events. Don King has been theconsummate sports promoter by packaging professional boxing events in

large venues and negotiating television rights and signing the athletes to

fight for a large prize purse.

Buyers/sponsors pay enormous amounts of money to advertise their

messages on the air, in stadiums/venues, on radio and in hospitality at the

various events. The Olympics and NASCAR have been particularlysuccessful as corporate entertainment venues. Of course, one should not

ignore the Super Bowl, Wimbledon, the Kentucky Derby and other single

day events, as corporate entertainment opportunities.

And, in almost all cases, there are athletes that perform their artful craft in

return for large salaries. Of course, these enormous salaries would not be

possible if not for the tremendous amounts of money paid by the television

networks. Virtually all of the professional athletes are represented by

agents, many of them attorneys, who negotiate salaries, bonuses,

deferred compensation packages, endorsements and other fees in return

for a percentage of the total fees. Many of the agents who represent a

large number of athletes have considerable leverage and experience in

this field and try to negotiate maximum fees while their athletes (clients)are healthy and in their prime.

Finally, none of the events can be staged without facilities. Management

and operations of the sports venues is a business in itself. The sale of


16/59

tickets, licensed merchandise, food and beverage and other operational

tasks, generate revenue and create a sense of excitement around the

events. In the case of the Olympics, these local organizing committees are

created for a short duration during which they create their owninfrastructure, rent facilities, organize competitions, sell tickets, stage

events and then effectively go out of business, all in the span of

approximately six to seven years.

All of these areas collectively and individually make up the sports

marketing industry. And within these areas are additional elements, such

as shoe, equipment and apparel manufacturers, licensing companies, food

and beverage vendors, advertising agencies (who create unique

commercial messages in association with sponsorship and television

broadcasts), public relations companies (who try to position their

clients/sponsors as good corporate citizens and many other supporting

players.

It is easy to see how the industry has grown over the years. All one has to

do is analyze how much sports programming is offered on over the air

(network) and cable television broadcasts. Since the incredible financial

and aesthetic success of the 1984 Olympics in Los Angeles, there has

been a proliferation of sports programming, sponsorships and events.

Rights fees continue to rise and sponsors continue to pay higher andhigher fees for the right to associate themselves with these big events and

the athletes who compete in them. It does not necessarily follow, however,

that this growth will continue unabated. There are signs that this trend has,

at the very least leveled off and may be in a slight decline. Television


17/59

ratings for all professional sports has been down in recent years and many

professional franchises are struggling financially.

However, the sports marketing industry remains an important and viablepart of the national economy and consciousness in this country and,

indeed, worldwide. World Cup Soccer, the Winter and Summer Olympics,

Alpine Skiing, Formula One Auto Racing and other events are highly

viewed by global audiences. That is why large multinational companies

like Coca-Cola, VISA, Kodak, XEROX and others continue to sponsor

these events.

With a large industry such as the sports marketing industry, the real

question is where do you fit in? Well address that topic in future articles.

Until then, maybe you can decide where the best opportunities are within

this multi-billion dollar industry. Good luck!


18/59

THE BUSINESS OF CRICKET: THE STORY OF SPORTS MARKETINGIN INDIA.

HOW SPORTS MARKETING HAS BOWLED US OVER

Sports marketing is all-pervasive today no matter where you look, there

is no escaping a Dhoni, a Tendulkar or a Sehwag. It wasnt always like

this. There was a time when sportspersons got fame from sport, but notthe money commensurate with that fame. Then Sunil Gavaskar, Indias

first batsman-entrepreneur, came along, and in his wake followed Kapil

Dev and Sachin Tendulkar. Helped by television and competing

multinational brands vying to expand their market in a liberalizing India,


19/59

sports marketing, which in India is synonymous with cricket, exploded. The

culmination of this process was the Indian Premier League (IPL), a brilliant

marketing concept that was a win-win for players, sponsors, media and

viewers alike.

This by two sports enthusiasts who are also ace sports marketers with a

combined international experience of forty years in marketing, takes us on

an engaging and informative journey through the highs and lows of sports

marketing in India. Along the way, the authors explain what constitutes

good sports marketing, how the market can be expanded, what theprospects are for sports other than cricket, and why the sports fan needs

to be better treated. An incisive, heartfelt book that will appeal to sports

fans, marketers, advertisers as well as administrators.


20/59

Professional Management Group (PMG) is Indias first sports marketing

agency. Realizing the growing popularity of cricket and other sports in the

country and understanding the potential for brands in it, PMG came into

inception in 1985.

Started by the legendary cricketer Sunil Gavaskar and advertising

professional Sumedh Shah, PMG has over the years developed and

innovated in diverse field in the industry successfully using the world of

sports to promote corporate and marketing objectives. In India, PMG has

been a frontrunner in successfully establishing the synergy between

sports, business and communication in various media, with several firsts

to its credit.

In June 2007, PMG added new directors to the board Sam Balsara,

Chairman and Managing Director, Madison Communications Private Ltd

and Noomi Mehta, Managing Director, SELVEL Advertising . PMGs

association with these reputed communication organizations has added awhole new dimension to our offering, enabling us to deliver 360-degree

sports marketing and management solutions to the client.

GROWING YOUNG AND URBANISED MIDDLE CLASS

Indias population has tripled in the last few decades, and it should

soon overtake the population of China, where the one-family-one-child

policy has led to a marked increase in the average age of the people.More than 1.2 billion people live in India, and nearly half of them have

less than 25 years of age.

In India, the development of the sports market is being partly fostered by
http://www.madisonindia.com/http://www.selvel.com/http://www.selvel.com/http://www.selvel.com/http://www.madisonindia.com/


21/59

the fact that the new generations are becoming increasingly urban,

educated and affluent. It is estimated that the countrys urban population

will soar to about 590 million people by 2030.

Indias Gross Domestic Product increased by 10.4% in 2010, according

to the IMF, and is likely to rise by another 8.2% in 2011. Some

economists predict that, based on the youth of its population and the

stimulant of democracy, among other factors, Indias economic growth

could lastingly outpace Chinas in a few years time.


22/59

While its benefits have not been evenly spread, with an estimated 40% of

the population still living in poverty, this economic growth has given rise

to a growing Indian middle class, which is expected to encompass some

580 million people by 2015 more than the total population of theEuropean Union. Highly attracted by western lifestyles and brands, they

are the driving force behind a rise in discretionary spending that has

already started to take place in the country, as shown in the first part of

our study.

WEAK BUT RISING SPORTS PARTICIPATION Unfortunately, only a small proportion of Indians practice sports, mainly

due to low disposable income and the shortage of adequate sports

facilities. Official sources suggest that, if we exclude physical education

in school, only 13.6 million Indians regularly engage in sports in their

leisure time with a preference for cricket, football and badminton, as

well as basketball although other studies seem to point to higher

sports participation rates. The Indian government has launched several

large-scale schemes for the promotion of sports,

but this is hardly a priority in the countrys budget, and the efficiency of the

governme nts investments is highly debatable.

Nevertheless, our consumer research has shown that many people are

interested in purchasing sports clothing and sports shoes if they have the

money, even if they dont practice sports. Growing disposable income

and shifts in lifestyles, particularly in urban India, have also begun to

cha nge peoples leisure habits and promoting more physical exercise,


23/59

particularly through running and membership in fitness clubs. Interest in

sports is also being bolstered by numerous grassroots initiatives by the

major sports brands and by new players in the market such as

Decathlon.


24/59

MARKET LAYERS

The Indian sporting goods market is relatively small and, like the

country itself, it should be split into several layers. The organizedsegment of the market mainly consists of the major international sports

apparel and footwear brands that have moved into the country in the last

two decades and spread by opening hundreds of mono-brand stores.

Their distribution is

Complemented by their sales to a few integrated retailers and many more

independent stores serviced by wholesalers.

This organized and branded market for sports apparel and footwear

has been estimated at about 550 million in 2010 and it has been

growing at an annual rate of about 15% in the last years. This segment is

uncharacteristically led by Reebok, trailed by Adidas, Puma and Nike,

which are all investing heavily in the market, hoping to see major returnsin the near future. Unlike the situation in China, the Indian market has not

yet seen the emergence of any

Indian brand competing directly with these international heavy-

weights. The largest Indian brands mostly operate at much lower price

levels.


25/59

The market for sports equipment is mostly handled by small

independent retailers. This business is estimated to be worth about 380

million annually, again with a growth rate in the range of 10% to 15% in

the last years. Among the most promising categories are fitness,badminton and tennis, along with some team sports.

Several Indian companies have been stepping up their investments in

the equipment market in the last years. Most of them are Indian

manufacturers who used to focus on production for international brands,

but started investing more in the distribution of their own brands in their own market. Some of them are making use of their Indian sales network

to take up distribution deals for foreign brands as well.

Then again, the wider Indian sports market comprises a less organised

layer, with thousands of small (and sometimes unregistered) sports and

footwear retailers selling mostly Indian brands and unbranded products,

mostly from China. This market could be estimated at about 1,650

million, with the inclusion of millions of pairs of cheap sports shoes that

cannot used for sports.

SPORTS RETAILING: UNDER CONSTRUCTION

In the coming years, the development of the Indian sports market

should be strongly influenced by far-reaching changes in retailing.

Currently, Indian retailing as a whole is still ruled by small independent

retailers, with less than 10% of all retail trade going through integrated

chains. The same applies to sporting goods retailing, with thousands of


26/59

independent sports and footwear retailers offering sports products.

These little outlets are efficient in reaching consumers but they are

small stores requiring intensive service, with regular replenishment and

often consignment.

They work mainly with regional wholesalers, which play a very

important role in the market. These wholesalers, whose way of

operating is very special, buy their products firmly from some major

sports brands and their distributors.

The growing interest of foreign companies in the Indian sports

market has started to alter the traditional retail structure. Although foreign

investment rules prevent international retailers from opening multi-brand

stores in India, sports brands have hundreds of franchised mono- brand

stores around the country.

Furthermore, several Indian retailers have raced ahead to open

supermarkets, department stores and other integrated chains before

international investment is allowed to pour in. So far, the only large-

scale investment in sports retailing has come from the Future Group,

owner of Planet Sports, which has 70 stand-alone stores around the

country. However, at least three regional sports retailers have mapped

out plans to open more stores in the coming years.

Supermarkets and hypermarkets sell certain types of sporting goods in


27/59

India, carrying western brands in some cases. Cash-and-carry

warehouses sell them, too. Various types of sports shoes, including

some sophisticated models, are sold by some big footwear retail

chains.


28/59

CHAPTER-2

REVIEW OF LITERATURE


29/59

1. (KUMUTHA, KIRUBAKAR, & MARGARET),

N Kumutha, S Glady Kirubakar, Glory D Margaret

Sports like cricket, football, hockey are fast catching up to become a

religion in India. The focus if not shifting from cricket is definitely being

shared by recent developments in hockey and formula1. The Indian

marketing arena is one of the biggest consumer markets .Necessary

skills required for a Sports Marketing management teams are oral

communication, organizational efficacy, creativity and leadership. The

paper also discusses about some of the specific duties of sports

marketing executives working in any of the above areas such as

negotiating, preparing contracts for athletes, planning and

coordinating sports events, etc. There are multiple opportunities in

terms of sponsorship sales, sponsorship activation, ticketing,

ceremonies, players management and advertising. With the Common

Wealth Games in the midst of many controversies, companies aresitting on the fence and are reluctant to join the bandwagon.The

Sahara group, a diversified business conglomerate, has broken an 11-

year association with cricket administrator BCCI.

The country's largest telecom operator Bharti airtel collaborated

with the Formula One (F1) Group Companies to become title

sponsor of the Indian leg of the race series, scheduled on October 30

following the telecom major's tie-up with the Formula One Group

Companies. Sanjay Kapoor (Bharti airtel CEO - India and SA) and

Formula One Group CEO Bernie Ecclestone were reportedly


30/59

happy after this association.Kapoor said there was a lot of merit

in being associated with the world's most popular motorsport

event.Kapoor said this was done for te sports market in India and

the need to connect with younger customers was always at the core of Bharti.

2. INDIA: OPPORTUNITIES IN THE BUSINESS OF SPORT, ANDYFRY

Professional Golf Tour of India (PGTI), in October 2006 was formed to

formlize Golf relaed activities and tournaments India. Managed byaround 100 golfers, the PGTI was a breakaway from the PGAI

(Professional Golf Association of India), and has pretty much taken

control of the sport As a result, India is now home to four Asian Tour

events - making it second only to China (with five events). Golfs

turnaround isnt just apparent in terms of the sponsors it attracts (which

also include Johnnie Walker and Emaar). The PGTI has also sold its

exclusive broadcast rights to Sport 18, the sports marketing division

of media conglomerate Network 18. Network 18 managing director

Raghav Bahl is in no doubt that he is tapping into a growth

opportunity. Explaining his involvement in golf, he argues that a

fundamental shift is occurring, with the rise of non-cricket sporting

interest. With an expanding pedigree of home-grown world class

golfers, greater media support and sophisticated management, golf in

India can see the same heights as it has achieved internationally. This

partnership with PGTI will be a landmark for the game in India.


31/59

COMPARISON

(Reebok)to professionals, sports can bring fame and fortune. To

facilities developers and local governments, sports are a way to buildrevenue from tourists and local fans. Sports are deeply ingrained in

education, from elementary through university levels. Perhaps we

cannot state with confidence that sports enrich the lives of all of us, but

they certainly entertain a huge swath of the worlds population. In

addition to economic impact, the largest single effect that sports create

is that of gripping entertainment: hundreds of millions of fans around

the globe follow sports daily, whether via radio, television, printed

publications, online or in person, as spectators or participants.

Sports are big business. Combined, the Big 4 leagues in America,

the National Football League (NFL), National Basketball Association

(NBA), the National Hockey League (NHL) and Major League Baseball

(MLB), bring in about $24 billion in revenue during a typical year, butthat s just the tip of the iceberg. U.S. sporting equipment sales at retail

sporting goods stores are roughly $41 billion yearly, according to U.S.

government figures. A reasonable estimate of the total U.S. sports

market would be $400 to $435 billion yearly. However, the sports

industry is so complex, including ticket sales, licensed products, sports

video games, collectibles, sporting goods, sports-related advertising,endorsement income, stadium naming fees and facilities income,

that its difficult to put an all-encompassing figure on annual

revenue. When researching numbers in the sports industry, be

prepared for apparent contradictions. For example, the NFL receives


32/59

vastly more money each year for TV and cable broadcast rights than

MLB, despite the fact that MLB teams play about 10 times more games

each year than NFL teams.

While it may not seem like it to the casual observer, the sports sector is constantly evolving in terms of personal tastes, popular games and

technologies. For example, the decades-old Indy 500 has been

eclipsed by NASCAR in many ways. In fact, the personality and

popularity of a top athlete can have a tremendous impact on the

current popularity of a particular sport seven-time Tour de France

winner Lance Armstrong being a superb example with his extremelypositive impact on cycling during his active racing years. Research from

the National Sporting Goods Association (NSGA) indicates that tastes

in individual sports, exercise and recreation are continually evolving

in America. NSGAs 2011 sports participation study showed

kayaking to be the fastest growing sports activity in the U.S. among

consumers seven years of age and older. Kayaking increased 26.6%

over 2010, followed by cross country skiing at 11.5%, wresting

at 9.4%, aerobic exercise at 8.9% and running/jogging at 8.9%.

It should be noted that none of these fast- growing activities require

expensive equipment (kayaks can be purchased at relatively small

expense) or expensive club memberships.

NSGA reports that exercise walking is the most popular sports activity

in America, with 97.1 million people

participating. Exercising with equipment follows as a distant second at

55.5 million, then swimming at 45.0 million, overnight camping at 42.8

million aerobic exercising at 42.0 million, bicycle riding at 39.1 million


33/59

and hiking also at 39.1 million.

Participation in fitness classes like Zumba and yoga are strong. Tennis

continues to grow, up 7.0% in 2010. The fact that tennis is among the

least costly sports in which one can participate, combined with the factone can usually get to a tennis court without a long, gasoline-guzzling

drive in an automobile, could easily push tennis to greater popularity in

todays tepid economy and high gas prices.

Which brings up the entire problem of gasoline prices in recreation and

sports: clearly, expensive gasoline significantly dampens the popularity

of motor boats, RVs and anything else that has a large engine. Highgasoline prices and a slow economy can lead to reduced sales of

motorized recreation equipment, except in cases where that equipment

is known for high energy efficiency. Sailing anyone?

Meanwhile, the number of people playing golf in America has been

dropping over the long term, although audiences for televised golf

events remain very large. Then theres the fact that large audiences

have been watching high-stakes poker tournaments on television

recently. Does that qualify as sports broadcasting? Its certainly a game.

Moreover, thanks to the Internet, fantasy sports teams and online

betting on sports events are soaring.

Amateur participation in the team sports of lacrosse, volleyball and

rugby is extremely high. SGMA reports 33% growth in core participants

in lacrosse during 2010.

One of the strongest, long-term growth trends in all of the recreation

business is in fitness-related activities. In the U.S. alone, health

clubs boasted 51.4 million members in 2011, representing a 2.4%


34/59

increase, according to the International Health, Racquet & Sportsclub

Association (IHRSA). Americas 29,890 health clubs enjoyed revenues

of $21.4 billion (a 5% increase). Members visit their clubs an average

of about 100 days each year. Another 25 to 30 million Americans use exercise machines in their

homes, according to Plunkett Research estimates. Americas 75

million surviving baby boomers, with time and money on their

hands plus a growing concern about their quality of life, will boost the

health club and home exercise sectors further. (Sports and leisure

revenues from the Baby Boomer segment will grow quickly. For example, pickelball, a racquet and ball game played on a court about

one-quarter the size of a tennis court, is soaring in popularity with

senior citizens.)

Internationally, IHRSA research found there were 43.5 million health

club members in the European market during 2011. This represented

a decrease of 900,000, not surprising in light of the economic

downturn in Europe.

Globally, IHRSA estimates 133,000 health clubs serving 129 million

members as of 2011. It also reports that Brazil, a very body-conscious

nation and home of Rio de Jane iros famous beach culture, is second

only to the U.S. in the total number of health clubs.

Evolving technologies and fashions have an immense impact on

sales of sporting goods within specific sectors. Sporting goods makers

are constantly trying to create reasons for consumers to buy new

equipment. Golf ball and club makers adopt new technologies with

great success. Snow ski and board makers use new technologies as


35/59

soon as they become available. Additionally, ski gear manufacturers

introduce new fashions, new colors and new styles yearly in an effort to

get consumers to buy new or buy up, regardless of whether significant

new technologies are involved. Nanotechnology, with the ability toprovide components with tremendous strength at very low weight, is

being featured in new equipment to a growing degree, including tennis

rackets. Likewise, carbon fibers are increasingly seen in the

construction of upper-end equipment, including fine bicycles.

Meanwhile, media used to deliver sports and sports related

information are evolving quickly. Sports coverage is one of the mostwidely viewed categories online. At the same time, digital TV recording

devices (DVRs), such as TiVo, are enabling fans to watch events

according to their own schedules. The rapid emergence of sports

news and events video delivered via state-of-the-art mobile screens is

having a major impact. Watch for continued rapid change

throughout the sports industry, as consumers tastes and

manufacturers product lines evolve.

The global recession had a significant effect on sports and recreation

in 2008 and 2009. Professional teams encountered difficulty selling

tickets, and revenues for manufacturers of sports and recreation

equipment dropped. Gambling revenues plummeted. Consumers in

America and Europe are still keenly interested in their favorite sports

and recreation, but many are reducing their discretionary purchases,

and they are cutting back on luxury, leisure and entertainment

purchases in particular. Since ticket prices for professional sports have

become extremely expensive, sales have been affected. Some golf


36/59

courses suffered revenue declines, and many have closed. At least

two major U.S. sports teams fell seriously behind on their debts and

took bankruptcy during the recession. Even the NFL laid off 150

employees at the end of 2008. For the mid term, the sports industry willface challenges in providing services and products that are appropriate

for consumers in slow economies (particularly Europe as of 2012),

while revenues in emerging nations such as Brazil and China will have

an excellent opportunity to grow.

The biggest opportunities in the sports industry today lie in providingexciting, high-value opportunities for sports fans, such as high-tech

recreational gear at reasonable prices; spectator sports ticket

packages that represent good value; exercise/fitness services and

programs that will appeal to aging baby boomers; and equipment and

apparel that represents high value and exciting design. Consumers still

want to play, but they want to do so at a reasonable cost.


37/59

CHAPTER 3

RESEARCH METHODOLOGY


38/59

MEANING OF RESEARCH

Research in common parlance refers to a search for knowledge. Once can

also define research as a scientific and systematic search for pertinent

information on a specific topic. In fact, research is an art of scientific

investigation. The Advanced Learners Dictionary of Current English lays

down the meaning of research as a careful investigation or inquiry specially

through search for new facts in any branch of knowledge. Redman and Mory

define research as a systematized effort to gain new knowledge. Some

people consider research as a movement, a movement from the known to the

unknown. It is actually a voyage of discovery. We all possess the vital instinct

of inquisitiveness for, when the unknown confronts us, we wonder and our

inquisitiveness makes us probe and attain full and fuller understanding of the

unknown. This inquisitiveness is the mother of all knowledge and the method,

which man employs for obtaining the knowledge of whatever the unknown,

can be termed as research. Research is an academic activity and as such

the term should be used in a technical sense.

According to Clifford Woody research comprises defining and

redefining problems, formulating hypothesis or suggested solutions;

collecting, organizing and evaluating data; making deductions and reaching

conclusions; and at last carefully testing the conclusions to determine

whether they fit the formulating hypothesis. D. Slesinger and M. Stephenson

in the Encyclopedia of Social Sciences define research as the manipulation

of things, concepts or symbols for the purpose of generalizing to extend,

correct or verify knowledge, whether that knowledge aids in construction of


39/59

theory or in the practice of an art. Research is, thus, an original contribution

to the existing stock of knowledge making for its advancement. It is the

persuit of truth with the help of study, observation, comparison and

experiment. In short, the search for knowledge through objective andsystematic method of finding solution to a problem is research. The

systematic approach concerning generalization and the formulation of a

theory is also research.

As such the term research refers to the systematic method consisting

of enunciating the problem, formulating a hypothesis, collecting the facts or

data, analyzing the facts and reaching certain conclusions either in the form

of solutions(s) towards the concerned problem or in certain generalisations

for some theoretical formulation.

DEFINITION OF RESEARCH

Research is the systematic and continuing study and evaluation of all factorsbearing on any business operation which involves the transfer of goods from

production to consumers.

Research is the systematic problem analysis; model building and fact finding

for the purpose of improve decision-making and control in marketing of good

and service

In words of Clifford Woody

Management has become a part and parcel of everyday life, be it at home, in

the office or factory and in Government. In all organizations, where a group of


40/59

human beings assemble for a common purpose, management principles

come into play through the management of resources, finance and planning,

priorities, policies and practice. Management is a systematic way of carrying

out activities in any field of human effort.

RESEARCH COMPROMISES OF -

Defining and re-defining problems,

Formulating hypothesis or suggested solutions, Collecting

Organizing and evaluating data

Making deductions and researching conclusions

At last carefully testing the conclusions to determine whether they fit the

formulating hypothesis.

In short, the research is an original contribution to the existing stock of

knowledge making for its advancement or the search for knowledge through

objective and systematic method of finding solution to a problem is research.

Thus to conclude we can say that The systemic approach concerning

generalization and the formulation of a theory is also research

METHODS OF DATA COLLECTION

The task of data collection begins after a research problem has been defined.

While deciding about the method of data collection to be used for the study,

the researcher should keep in mind two types of data vise, primary and

secondary.


41/59

Secondary Data: - The secondary data are those which have already

been collected by someone else & which have already been passed

through the statistical process.

COLLECTION OF SECONDARY DATA

Secondary data means data that are already available i.e. they refer to the

data which have already been collected & analyzed by someone else.

Secondary data may ether be published data or unpublished data .

PUBLISHED DATA ARE AVAILABLE IN:-

Various publications of central, state & local government.

Publications of foreign government & other organizations.

Technical & Trade Journals.

Reports & Publications. Books, magazines & newspapers.

Reports request by the research scholar universities economic etc. in

different field.

Public records and static historical document and other sources of

published information.

The sources of unpublished are many, they may be found in letters and

published biography and autography.


42/59

SECONDARY DATA POSSESS FOLLOWING CHARACTERISTICS

1. RELIABILITY OF DATA:

The reliability can be tasted by finding out such things about the said

data:

a. Who collected the data?

b. What were the sources of data?

c. Where they collected by using proper method?

d. At what time were they collected?

e. Was there any bias of the compiler?

f. What level of accuracy was desired? Was it achieved?

2. SUITABILITY OF DATA:

In this context, the researcher must very carefully scrutinize the definition of

various terms and units of collection used at the time of collecting data from

the primary source originally. Similarly, the object, scope and nature of the

original inquiry must also be studied. If the researcher finds differences in

these, the data will remain unsuitable for the present enquiry and should not

be used.

3. ADEQUACY OF DATA:

If the level of accuracy achieved in data is found inadequate for the purpose

of the present enquiry, they will be considered as inadequate and should not

be used by the researcher. The data will also be considered inadequate, if


43/59

they are related to an area, which may be either narrower or wider than the

area of the present enquiry.

OBJECTIVES OF RESEARCH STUDY:Getting general data on the market for sports goods in India, including

general social and economic data such as imports, exports and production

statistics for various types of sporting goods.

Getting general information about the lifestyle trends and

preferred sports activities.

To study the various (market players )companies involve in sportsindustry

To study the various concept of sports marketing

To study need of sports marketing

To study the spending proportion in various activities

To study the various marketing trends in sports marketing

SIGNIFICANCE OF RESEARCH

The main purpose of these reports, has been to assist sporting goods

companies in improving their market penetration in every country.

By recognising their development potential in each market

By knowing all the aspects of each market, including economic,

demographic, consumption and sports participation trends and the


44/59

structure of the supply chain

By benchmarking their performance in each country against that of

other companies

By learning more about the major players in each market, includinglocal competitors and local distributors and retailers

By identifying potential new distribution partners

By taking inspiration from the strategies and moves of other companies

in the region

By defining the best possible market entry and penetration strategies

By avoiding possible mistakes

All the country reports that we have published are still for sale, country by

country or volume by volume, at reduced prices. Comparable or higher

benefits can probably be expected from a better market knowledge about

the major emerging markets, which are growing much faster, offering plenty

of opportunities for all sorts of brands.

Six years after launching our successful report on the sporting goods

sector in Russia, we are tackling here another important emerging sports

market with our brand-new report on India. This country has been chosen

because it offers much more room for growth than any individual western

market and because very little reliable information has been published so

far about it.

To help clarify the market situation in India, we have decided that we could

not limit ourselves to the consultation of the available documentation and to


45/59

a vast number of executive interviews, which have required a lot of time

and travel expenses. Thus, as we did with the Russian market six years

ago, the report on the Indian sporting goods market also contains the

findings of a unique consumer survey carried out by our Indian researchpartners, Indian Business News Agency, among 800 urban consumers in

five Indian metropolitan areas.


46/59

CHAPTER -4

DATA INTERPRETATION


47/59

PEST ANALYSIS

Central to successful and effective marketing is the identification andsatisfaction of the needs and wants of the sports market. By understanding

the place of the organisation within the market and the forces that impact

on decision making, the sports marketer can gain a better realization of the

context

their organization exists within. A key feature of successful marketing isbeing flexible to situations arising outside the organization. Many sporting

organizations have to deal with a variety of changing influences and forces

that are in a constant state of flux. These are environmental considerations

that impact on the way that the sports marketer creates, implements, and

analyses their marketing campaigns. This chapter will investigate the

environmental forces that surround and permeate sports organizations and

the sports marketer within them. The first part of this chapter will discuss

the key principles of environmental analysis which, is that these external

forces impact on all organizations, sport and non-sport, that operate within

the same environment. Some of these forces can be controlled while other

forces the sports marketer has to adapt their practices to. Following this a

section detailing each of these forces an examination of market analysis

tools and techniques will highlight the how to carry out environmentalanalysis. Within this chapter two case studies will be used to demonstrate

the inter-connectedness of these factors on both sport and non-sport

organizations that are involved in the marketing of sport


48/59

1: The External Environment of the Sports Organization

The External Environment

The external environment consists of a number of separate factors andforces that impact on marketing decisions made by the sporting

organization. The model adopted for categorization of the external

environment in this chapter is PESTEL. This mnemonic stands for six

environmental influences, the first being the political environment which is

characterized by the ideology of the party in power and the tier (level) of

government. The economic environment is dependent on macro- and

micro-economic conditions that pervade organizations and the regions in

which they operate. The socio-cultural environment is

Political Economic Socio-Cultural Ecological/ Ethical Legal

Regulatory Technological

The External Environment

The Sport Organization influenced by shifts in society and consumer tastesas well as being characterized by cultural differences and their impact on

the marketing process. Following on is the technological environment which

is one of the most revolutionary and rapidly expanding influences over the

past twenty years. It is the impact of technology on the operations of the

sport and the impact of technology on the ability of the sporting

organization to carry out its activities, which are the focus of this section


49/59

POLITICAL ENVIRONMERNT

This environment describes the political landscapes and structures that a

sports organization operates within. An example of this is the politicallandscape in Britain where politics has in recent times shifted towards a

central of political ideology with more compromised views on governance

and its role in society (Henry, 2001). The views of political parties from

traditional conservative and social reformist viewpoints have been softened

to create a third way of government, as evidenced by New Labors term in

office in Britain. Due to the profile and mass appeal of sport the body politichas been keen to associate itself with successful, popular sport. John

Howard the prime minister of Australia is one of the leading supporters of

Australian cricket, described by some as a cricket tragic. In Britain New

Labor were quick to arrange a formal reception, and subsequent photo

opportunities, with the World Cup winning English Rugby Union team, upon

their return from victory.

Political influence has an impact on the operations and administration of

sport as high lighted through two main areas that should be included in the

environmental scanning process. The first sphere of influence from the

political environment is the ideology and policies of the governing parties

involved. This factor can therefore determine the level of involvement and

support for sport as an industry or as a past-time. Second the tier of

government and the impact of its operations and influence is an issue for consideration as political bodies operate at international/regional, national,

intra-national and local levels. Indeed differences in ideology can exist

between the tiers of government which can also create turbulence for the


50/59


51/59

range and type of marketing strategies employed by sports organizations.

These cycles affect the levels of consumer demand, which describes how

willing they are to purchase sporting goods and services. In periods of positive economic growth organizations and consumers have confidence in

the positive aspects of the economic environment and are therefore

prepared to spend and invest. Alternatively in the periods of recession

consumers are more concerned with saving due to levels of economic

uncertainty. An example of this impact can be seen when considering the

trend of professional sporting franchises in the United States and their

growing reliance on corporate funds from luxury seat and box sales. This

reliance consolidated during the stable periods of the 1990s (Howard and

Burton, 2002). Following the attacks on America on September 11 th,2001 a

period of social and economic uncertainty led the American economy into

recession. Looking to protect themselves from a downturn in the economy

the corporate customers of the franchises cut back their spending. This

impacted on the franchises ability to gain funds and market their activitie.

SOCIO-CULTURAL ENVIRONMENT

Every organization must take into consideration the various beliefs and

differences between their members and potential members. Differences

along geographical, cultural, societal andethical lines act to increase the

changing composition and nature of this environment. Amyriad of aspectscould be taken into consideration in the environmental analysis and each

of these can differ again when marketing across local, national and

international regions. To simplify this, two aspects will be examined. First

shifts in societal tastes, which will focus on the changing nature of the


52/59

dominant market in a particular region, the second will examine the cultural

differences that can be used to understand and include all cultures in a

modern sporting provision.

The Technological Environment

The technological environment is probably the most dynamic and uncertain

environmental forces that face the sports marketer. Technology influences

our daily activities and although the rate of change of this force has

increased in the last-twenty years it has been ever-present since the

industrial revolution. Technology impacts on the ability of the sports

manager to operate and administer their sport. Hence technology that has

increased the performance of sport and technology that allows for more

effective administration are two separate areas that sports marketers need

to be aware of. Sport organizations have used new technologies to improve

the playability of their sport for a number of years. There are instances

where these advances in technology have benefited sport by making itmore attractive and hence more marketable to a wider

audience. Nevertheless there are also instances where advances in

technology have taken away from the 15 human-error element that has

made sport attractive in the past. In the first category an example of these

benefits is the development of stadium technology that has made sport

more enjoyable and comfortable to watch. The development of stadiadesigned for consumer comfort and better viewing, as opposed to the

development of stadia for mass spectatorship has been due to changes in

not only consumer preference but technology that allows the modern

stadium-gore to sit in relative comfort, out of the elements of the weather,


53/59

and have the opportunity to receive up-to-date statistical information,

internet access and replays on small in-seat information screens. This

makes it a very different experience to the days with cold meant pies on awet and windy terrace. These developments can allow the sports marketer

to appeal the sport offering to a wider-potential audience so using

technology to explore new markets and find new income streams

Organization must take into consideration the various beliefs and

differences between their members and potential members. Differences

along geographical, cultural, societal and ethical lines act to increase the

changing composition and nature of this environment. A myriad of aspects

could be taken into consideration in the environmental analysis and each

of these can differ again when marketing across local, national and

international regions. To simplify this, two aspects will be examined. First

shifts in societal tastes, which will focus on the changing nature of the

dominant market in a particular region, the second will examine the cultural

differences that can be used to understand and include all cultures in amodern sporting provision. Shift in Society and its Tastes Sport has a

traditional role in the societies of many countries across the globe. Certain

sport shave dominated from high participation and high publicity that have

allowed those working within them to rely on this traditional link with

aspects of society such as class. For instance rug by league in Australia

has strong roots in the working classes of Sydney and north Queensland,while in the southern states of Australia Australian-rules football have been

similarly supported by the working classes. From an English perspective

the divide between social class and rugby code has long been established

and was until recently highlighted by geographical location. This has led


54/59

some sports in the past to rely too heavily on this tradition and enter a state

of marketing myopia as they have felt these links would be ever-lasting.

The societal make-up in the suburbs of cities such as London and Sydneyhas changed dramatically over the past twenty years. With these shifts the

traditional customer base of certain sports has altered.

The process of gentrification in Sydney and the arrival of new immigrants

and the white -flight in East London have seen sporting organizations such

as Bal main Rugby League Club and Ley ton Orient Football Club lose their

traditional supporters and only after readjusting their marketing activities

have been able to appeal to these new social groups.


55/59

Chapter - 5

CONCLUSION & SUGGESTIONS


56/59

CONCLUSIONS AND RECOMMENDATIONS

1. Sports marketing is restricted to Cricket as seen in the Indian

marketing scenario

2. Majority of the Sports equipment manufacturers and sports

companies are unwilling to invest in other sports like football,

badminton, formula one because of a lesser mass they can target.

3. As compared to the US the Indian sports industry and its

marketing has not been tapped to its full potential and there are

many more arenas other than cricket that the companies might

explore for increasing their business.

4. Major reasons for not investing more than what the companiesspend at present would be lack of infrastructure and the mass

appeal of a host of other sports in India.

5. Cricket is the most popular sport in India also said that Cricket

should be given more coverage in terms of media, sponsorships.

This might be the reason why sports companies are still focussingtheir attention on cricket above any other sport in India

6. Merchandize purchases are not made because of the stock are

not available. This was evident when certain merchandize was not


57/59

available in cities other than metros. Nike does not sell official

training jerseys of the Indian cricket team in cities like Pune

whereas in New Delhi it was readily available though they were notavailable in all sizes.

7. Online store of Nike India (www.nike.co.in) did not sell

merchandize related to sports teams like cricket, football etc.

8. Sports companies are in a bid to make sports a lifestyle and

hence a major concentration of their marketing revolves around

merchandize that is related to fitness apparels and gear

9. For effective & successful marketing in sports external forces or

factors play vital role. Political, economical, technological, socio

cultural, ecological and legal factors affect the marketing decisions

10. The cultural differences & taste of consumer has impact on

marketing process. Political process has influence on an impact on

the operations and administration of sports because ideology &

policies of governing parties involved.

11. The Economic conditions of nations are also affect the sports

marketing
http://www.nike.co.in/http://www.nike.co.in/http://www.nike.co.in/


58/59

12. Technological environment is also a most dynamic & uncertain

environment factor because technological impacts on the ability of

sports manager to operate their sports and buying process.

13. The study also attempts to put into perspective how consumers

who have inclination towards different sports see fairness or

legitimacy in the popularity of other sports. The scope of the study

covers the buying behaviour of consumers related to merchandize

of various sports but not the reasons which affect these buying

behaviours like family , peer influence , nag factor of children etc.

The biggest opportunities in the sports industry today lie in

providing exciting, high-value opportunities for sports fans, such as

high-tech recreational gear at reasonable prices.

The time has come for the sports company to shifts its focus on other

equipments then cricket. Now the scenario of Indian sports market is

shifting towards other sports like Football, Hockey, Golf etc. thus in order

to get upper age on the sports product company. Like Nike, Adidas etc.

Need to concentrate from the very beginning towards these sporting

events.

Marketing of sports largely based on sporting icon like Dhoni, Sachin incase of cricket. Bhutia in case of Football and Saina Nehwal in case of

Badminton. Thus it is being recommend companies should start shifting

their eyes from cricket to other sporting events and in order to concave

large sports market available in India


59/59

BLIOGRAPHY

BOOKS

Amit Sharma, P. B. (2008). film sports merchandising yet to pick up

in India. Indiatimes.

Bhatar, G. (2012, December). (T. Bamrara, Interviewer)

Fry, A. (n.d.). India: Opportunities in the Business of Sport.

Kumutha, N., Kirubakar, S. G., & Margaret, G. D. (n.d.). 1. Prospects

and strategies for sports marketing in

o

India.

Nike . (n.d.). Retrieved from www.nike.co.in

Reebok . (n.d.). Retrieved from www.reebok.co.in

Reebok CrossFit one . (n.d.). Retrieved from

www.reebokcrossfitone.com
http://www.nike.co.in/http://www.nike.co.in/http://www.nike.co.in/http://www.reebok.co.in/http://www.reebok.co.in/http://www.reebokcrossfitone.com/http://www.reebokcrossfitone.com/http://www.reebokcrossfitone.com/http://www.reebok.co.in/http://www.nike.co.in/

Documents

Monika Main Final