Sports & Entertainment Marketing

Mrs. Wilson

LICENSING: What DOES it mean?

An agreement that give a company the right to use An agreement that give a company the right to use another’s brand name, patent, or other intellectual another’s brand name, patent, or other intellectual property for a royalty or a feeproperty for a royalty or a fee

LicensorLicensor Is the company or individual granting the license for a Is the company or individual granting the license for a

fee in this legally binding contractfee in this legally binding contract

Licensee Licensee Is the company or individual paying for the rights to Is the company or individual paying for the rights to

sue the licensor’s name or propertysue the licensor’s name or property

Licensed Products

In sports marketing, a company may pay a fee to In sports marketing, a company may pay a fee to use a league’s, team’s or individual’s name, image, use a league’s, team’s or individual’s name, image, or logo on a product or on its packagingor logo on a product or on its packaging

Sports figures on a box of cereal or T-shirt, you Sports figures on a box of cereal or T-shirt, you know that a company is paying a fee to that sports know that a company is paying a fee to that sports figure or team (licensor)figure or team (licensor)

Ex: NHL web site will show the types of licensing Ex: NHL web site will show the types of licensing dealsdeals

Mutual Advantages

The Products

Licensing agreements can apply to Licensing agreements can apply to just about any product imaginable.just about any product imaginable.

Apparel, key chains, toys, sports Apparel, key chains, toys, sports equipment, food products, credit equipment, food products, credit cards, video games, and household cards, video games, and household items items

Merchandising Licensed Goods

It is available through many channels of distributionIt is available through many channels of distribution

Department stores, chain stores, league-sponsored Department stores, chain stores, league-sponsored retail outlets, Internetretail outlets, Internet

Some own their own retail storesSome own their own retail stores

Sweepstakes and contests are run by a sponsor, with Sweepstakes and contests are run by a sponsor, with the prize being tickets to the sporting eventthe prize being tickets to the sporting event

Merchandising Licensed Goods Sponsors provide promotional supportSponsors provide promotional support

Some licensed products are used as promo Some licensed products are used as promo incentives for buying a productincentives for buying a product

Sports Illustrated:Sports Illustrated: You may receive a free video of that year’s You may receive a free video of that year’s

most celebrated athlete. most celebrated athlete. The video is the licensed product.The video is the licensed product.

Two Forms of Licensing: Sponsorships & Endorsements

What is the world’s What is the world’s most recognized logo?most recognized logo?

Olympic’s Five Rings….

Companies Pay Top $$$

They pay for the right to be identified They pay for the right to be identified as one of the sponsorsas one of the sponsors

Agreements are made called Agreements are made called sponsorships or endorsements sponsorships or endorsements

Sponsorships

Promotional vehicles that financially support sports events

All major sports organizations use sponsorships

Importance of Sponsorships

Exposure & Free PublicityExposure & Free Publicity Olympics—exposure is internationalOlympics—exposure is international

Research is done to measure the impact of Research is done to measure the impact of sponsorship programssponsorship programs

Can you name a product or service that you associate with a sports figure?

Sponsorship Types Can be flexibleCan be flexible Can sponsor a team for a length of time or just Can sponsor a team for a length of time or just

an eventan event Just portions of an event—halftime sponsorJust portions of an event—halftime sponsor

Signage--sSignage--signs at a stadiumigns at a stadium Hoods / Uniforms--NASCARHoods / Uniforms--NASCAR Virtual BoardsVirtual Boards FloorboardsFloorboards Scoreboards Scoreboards

Premium Sponsorship

Two examples are entitlements and product exclusivity Entitlement: Occurs when there is one

major sponsor for an event• Ex: NASCAR signed a 10-year contract with

Nextel (replacing who?? And why?)• Ex: PGA grants entitlement sponsorships for

almost all of its schedule of its tour events (Buick Invitational, Sony Open, AT&T National Pro-Am)

Product Exclusivity: Only one product in a product category is granted sponsorship.

• Ex: Coca-Cola sponsors the Olympics, therefore only Coke can be sold at the Games.

Evaluating Sponsorship Effectiveness

Why sponsorship works affinity marketing

• Define affinity—• An attraction to or liking for something• Relationship/Kinship

Why it sometimes doesn’t work ambush marketing

• Define ambush—• To attack

Ambush Marketing

Examples of Ambush Marketing 1984 Olympics: Kodak sponsors TV broadcasts of the

games as well as the US track team despite Fuji being the official sponsor. Fuji returns the favor in kind during the Seoul 1988 games of which Kodak is the official sponsor.

At the 1992 Barcelona Olympics Nike sponsors press conferences with the US basketball team despite Reebok being the games’ official sponsor.

In the greatest ambush marketing feat of all time Nike’s man Michael Jordan, Air Sponsorship himself, accepts the gold medal for basketball and covers up the Reebok logo on his kit.

Nike’s Ambush The 1996 Atlanta Olympics is still seen as the ambush

of all ambushes.

Saving the US$ 50 million that an official sponsorship would have cost, Nike plastered the city in billboards, handed out swoosh banners to wave at the competitions and erected an enormous Nike center overlooking the stadium.

The tactics devastated the International Olympic Committee’s credibility and spooked other organizations such as FIFA into adopting more assertive anti-ambushing strategies.

Endorsements

This is a statement of approval of a product, service, or idea made by an individual or organization speaking on behalf of the advertiser

Usually involve celebrity figures or a public figure

Entitlements

Occurs when there is one major sponsor for an Occurs when there is one major sponsor for an event. NASCAR signed a 10-year contract with event. NASCAR signed a 10-year contract with Nextel to be its sponsor. Benefit is exposure to the Nextel to be its sponsor. Benefit is exposure to the 75 million fans in over 100 countries. 75 million fans in over 100 countries.

Also facility entitlements through which a company Also facility entitlements through which a company purchased the promotional rights to an entire purchased the promotional rights to an entire stadium.stadium.

Product Exclusivity

Another premium sponsorship whereby only Another premium sponsorship whereby only one product in a product category is granted one product in a product category is granted sponsorship. sponsorship.

No other competitor’s products can be sold No other competitor’s products can be sold or promoted. “Pouring rights” at our school or promoted. “Pouring rights” at our school is an example.is an example.

Assignment (if time permits)

Name two forms of licensing and briefly describe them.

How do sponsorships benefit the sports organization and the sponsor?