Sports marketing consulting strategies


Published on

Published in: Business, News & Politics
  • Be the first to comment

  • Be the first to like this

No Downloads
Total views
On SlideShare
From Embeds
Number of Embeds
Embeds 0
No embeds

No notes for slide

Sports marketing consulting strategies

  1. 1. Best Practices SessionLarry DeGarisPh. D., University of IndianapolisAbstractSport marketing academics have increasingly recognizedthe value of making their work more relevant to practition-ers. However, there is little literature about specific strate-gies and tactics for academics to conduct research that willbe of use to sport marketing practitioners. In this paper, Iwill suggest some strategies and tactics for sport marketingacademics interested in identifying and pursuing consultingopportunities in the sport industry. Drawing on my experi-ence as a sport marketing consultant, I suggest that acade-mics seeking to work with practitioners should focus their at-tention on sponsorship sales support, marketing planningand sponsorship activation, and sponsorship and marketingevaluation.Key Words: Applied research, sales support, marketing plan-ning, sponsorship evaluation.XXOPHΓIAOPHΓIA –CHOREGIAHOREGIASport ManagementInternational JournalSMIJ – VOL. 4, Number 2, 2008Scientific Forum inSport ManagementSportMarketingConsultingStrategiesandTactics:BridgingtheAcademyandthePractice
  2. 2. Sport marketing academics have increasingly recognized the value of mak-ing their work more relevant to practitioners. Irwin (2002) asserted that a pro-fessional consultancy approach is a means of engineering such a bridge be-tween theory and practice. Irwin argued that consultancy projects conductedby academics for practitioners can improve the quality of research efforts, pro-vide mentoring for junior faculty, and enhance student learning experiencesand employment prospects. However, while Irwin cited examples of consultingprojects conducted by academic entities, he did not discuss how academicsinterested in pursuing consulting relationships might go about it.In this paper, I will suggest some strategies and tactics for sport market-ing academics interested in identifying and pursuing consulting opportunitiesin the sport industry. Drawing on my years of experience as a sport market-ing consultant and the hundred or so research reports I have written for in-dustry clients, I will propose strategies and tactics to identify and approachprospective clients, prepare and present successful proposals, write reports,and maintain and expand relationships with practitioners. Since the bulk of myexperience is in research consulting, the emphasis of this paper will be onmarket research. However, I will conclude by suggesting opportunities to ex-pand research efforts into other consultancy efforts, such as sales consulting.Identifying Prospective ClientsSport marketing research is a tough sell. Sport properties conduct muchless research than comparably sized businesses in other categories and rarelyhave a dedicated research budget or professional research staff. Among cor-porate sponsors, sponsorship-related research expenditures have not kept pacewith the increased focus on return on investment (ROI). As an industry –bothacademic researchers and sport-related private sector market researchers– wehave failed in large part to effectively communicate the benefits of research tosport marketing practitioners. Consequently, the onus is on sport marketingacademics to demonstrate the value of research to practitioners. In order toforge more partnerships between academic endeavors and industry practition-ers, sport marketing academics need to practice what they teach. That meansstarting with identifying the needs and wants of potential clients.Marketing Practitioners as Clients. Since only a handful of sport propertiesemploy even one full-time researcher, research vendors frequently must ap-proach marketers to sell their services. Even in very large corporate sponsorsthat have market research departments, the client usually comes from themarketing, sponsorship, or public relations arm of the corporation. Researchefforts are often coordinated and/or approved by the market research depart-ment of the corporate sponsor but the department handling the sponsorshipalmost always pays the fee.12 SMIJ – VOL. 4, Number 2, 2008
  3. 3. Practitioner Needs and Wants. Even a casual perusal of the sport andsponsorship industry trade press results in the identification of a range ofproblems facing marketing practitioners. There are larger strategic problems,such as the aging fan bases for major professional sports or calculating returnon sponsorship investments for sport sponsors. And there are more tacticalproblems, such as the best starting time for a Sunday game or whether asponsor should pursue a league-wide or an individual team sponsorship with-in a particular sport.For example, the timely identification of a shared need among NASCARsponsors resulted in the NASCAR Sponsorship Study out of James MadisonUniversity’s Center for Sports Sponsorship. In the past couple of years, costshave spiraled for NASCAR sponsorships. NASCAR sponsors have become in-creasingly concerned about rising costs amid challenging economic circum-stances. Some sponsors left NASCAR altogether; others significantly down-sized their relationships. However, many sponsors simply reacted to the«sticker shock» instead of rigorously analyzing the value these relationshipsdelivered.The specific circumstances surrounding NASCAR dovetailed with a broaderincreased demand for evidence of ROI. Sponsors need empirical support butcustomized research on low incidence populations such as NASCAR fans caneasily run into a six-figure fee from a private market research company. In aneffort to create a more affordable research tool for NASCAR sponsors, thestaff at the Center for Sports Sponsorship developed the NASCAR Sponsor-ship Study based on a syndicated market research report model and success-fully sold the study to sponsors Gatorade, UPS, the Home Depot, and ESPN.Sales StrategyResearchers often misconceive what it is they are selling, frequently mak-ing the mistake of selling the «study» (i.e., the data collection, the report, etc.)instead of the benefits of the study. Clients buy the solutions to their problems,not the data. Therefore, successful research sales must emphasize the bene-fits of research, not the data collection methods or data analysis procedures.While research studies of course need to be customized to individualclients, each of the market research reports I have authored for sport indus-try clients falls into a typology of benefits. Sport properties (e.g., teams,leagues, etc.) use research primarily for sales support, but also for strategicplanning and program justification (Table 1). Sport sponsors use research pri-marily for sponsorship evaluation and program justification, but also for strate-gic planning (Table 2).Sales Support for Sport Properties. The biggest challenge in selling re-search is that it is always at least one step removed from creating revenueSPORT MARKETING CONSULTING STRATEGIES AND TACTICS 13
  4. 4. for the organization. Since marketers are primarily concerned with creatingrevenue, they seek ways to translate research into streams of revenue, themost common of which is sponsorship. Sport marketers need to demonstratetheir value to prospective sponsors. Research can help by providing evidenceof an attractive audience.For example, audience demographics can be indexed to local and/or na-tional populations to demonstrate appealing characteristics such as affluenceand youth. Researchers can measure product usage in selected categories toidentify potentially fertile markets. But researchers can and should go beyondbasic demographics and product usage. Researchers can identify the «it» as-sociated with the property, a brand association with which sponsors would beinterested in linking their brands and companies. Sponsorship proposals aremore effective when assertions are supported by empirical data, especiallywhen the data are customized to a specific prospect.Research can also be used to assist in renewals of existing sponsors. Aspart of the general trend toward evidence of ROI, sponsors seek more so-phisticated and rigorous sponsorship fulfillment reports. Researchers can playan integral role in the production of sponsorship fulfillment reports because oftheir command of audience characteristics and sponsorship performance. Aconvincing fulfillment report will likely lead to higher renewal rates. In addition,sport properties can use evidence of sponsorship performance to negotiatemore favorable sponsorship contracts. Or, if the evidence points in the otherdirection, a property can use the research results to create a sponsorshippackage that would be more suitable to the sponsor. It is better to have a re-duced relationship with a sponsor than none at all, which would be the caseif sponsorship costs continued to outweigh benefits delivered.Beyond specific cases, sport marketing academics are positioned to play animportant role in promoting the disciplines of sponsorship and sport marketingas a whole. While advertising and public relations professionals each have pro-fessional associations promoting their respective disciplines, sponsorship andsport marketing executives do not. As a credible and independent third party,the sport marketing academy can provide support for the overall effectivenessof these disciplines in the larger marketing and business communities.Strategic Planning. Sport marketing practitioners are primarily concernedwith tactical marketing issues, such as deciding how best to allocate their lim-ited marketing resources. It’s a zero sum game. If a sport marketer hiresmore sales representatives, that reduces the advertising budget. Researcherscan provide guidance for specific tactical questions, such as when to start aSunday game or how many sales representatives should be hired.While the emphasis is on tactical decisions, many practitioners are also in-terested in broader strategic questions. The difference between academic in-terest in theory and practitioner interest in practice is one of intensity; it is nota categorical difference. Many sport practitioners are keenly interested in the-14 SMIJ – VOL. 4, Number 2, 2008
  5. 5. oretical frameworks but lack the time and resources to devote much attentionto developing and refining their positions because they face more immediatetactical decisions. As more sport leagues and even some teams add fan de-velopment departments, interest is growing in creating models of understand-ing surrounding the fan development process and implications for defining thecharacteristics of market segments.While at the Bonham Group, I conducted a Fan Acquisition Study target-ing 18-to-34-year-olds for the Cleveland Indians. Valerie Arcuri, Senior Di-rector of Marketing for the Indians at the time, commented that «the resultsof their efforts along with the study data will have influences far into the fu-ture for the Cleveland Indians organization» ( though the benefits of this kind of work can be far-reaching, few sportproperties can afford to commission research in which the benefits are exclu-sively or even primarily strategic in nature.There is also an organizational consideration in pitching strategic planningstudies to marketers. Hiring a consultant to assist with a marketing strategymight indicate (to some) a lack of marketing competence. In addition, cus-tomer satisfaction surveys are valuable to an organization and have othermanagerial implications but, like marketing strategy, are more than one stepremoved from creating incremental revenue. Insights into marketing strategiesand improving customer satisfaction can be added as secondary objectives,even if they cannot be used to justify funding a research study on their own.Program Justification. From an organizational perspective, sport propertymarketing practitioners must provide support for their marketing budgets: own-ers and general managers want evidence of results from their marketing ex-penditures. Researchers can provide assistance to sport marketing practition-ers by demonstrating return on the property’s marketing investment andproviding support of marketing effectiveness to senior management.For example, Spoelstra (1997) recounts an instance in which he extols thepotential value of sales representatives to the owner of a minor league hock-ey team who had recently spent $ 60,000 to advertise one game. However,Spoelstra made his argument based on estimates, not empirical measures.While conducting a league-wide fan survey for each member of the EastCoast Hockey League (ECHL), I led a project team that used items designedto examine the effectiveness of ticket sales representatives as compared toother marketing techniques. While the results of the study were likely mostfrequently used for sales support to prospective sponsors, Rick Adams, Pres-ident of the ECHL at the time, said the league and member teams used thereport to «address staffing needs and develop effective marketing strategies»( The point is that sport marketing practitionersneed help in convincing owners and general managers to spend money onticket sales representatives and other marketing efforts, and researchers canprovide valuable support.SPORT MARKETING CONSULTING STRATEGIES AND TACTICS 15
  6. 6. Table 1. Benefits of Research to Sport Properties.Sales Support • Demonstrate attractiveness of audience with detailed fanprofile including lifestyle, media usage, demographics, andattitudes toward sponsorship.• Create targeted proposals based on detailed demographicand lifestyle information about the audience.• Ensure renewals by including performance results in fulfill-ment reports.• Use sponsorship performance results to negotiate more fa-vorable terms.Strategic Planning • Allocate market resources.• Develop direction for marketing mix.• Identify market segments.• Assess fan satisfaction.Program Justification • Justify, defend, and increase your budget.Benefits to Sport SponsorsSponsorship Evaluation. Clearly, sponsors are asking for demonstrable ROIwith increasing frequency and intensity. While a direct link to sales is elusiveother than in situations where a sales element is integrated into the relation-ship (e.g., on-site retail presence), researchers can deliver measures of ef-fectiveness and efficiency (see Stotlar, 2004 for a more detailed sponsorshipevaluation model). At the end of the day, however, sponsors want to know ifthe relationships in question are working, or if their marketing dollars are bet-ter spent elsewhere.It is helpful to practitioners for researchers to design studies in order todraw conclusions about the sponsorship’s performance. It is often helpful todraw comparisons to other marketing communications, especially advertising,because it is frequently the biggest line item in marketing budgets. Re-searchers can provide competitive intelligence to sport sponsors by measur-ing competitors’ sponsorship performance and brand positioning, thereby iden-tifying areas sponsors can avoid or should put resources behind.Strategic Planning. Strategic planning for sponsorship usually flows out ofevaluation reports. Of the scores of sponsorship evaluations for corporateclients I have personally conducted, only one was designed for strategic plan-16 SMIJ – VOL. 4, Number 2, 2008
  7. 7. ning. And those results were used as an evaluative tool to check for the va-lidity of programs put in place by other members of the organization, not forplanning!Strategic benefits of research could include an assessment of the righttype of sponsorship (e.g., league, team, athlete endorser, etc.). Sponsors canalso use research to develop empirically based support programs and deter-mine appropriate leverage spending. Industry guidelines for a ratio of activa-tion spending to rights fees, such as 1.5:1, lack customization to specific cas-es. Sponsors can use research to discover fans’ trigger points toward specificsponsorship relationships and design more effective marketing communicationsprograms. Many of these benefits flow out of the evaluation process and cantherefore be included in the research design for an evaluation study.Program Justification. Spoelstra suggested that marketers should «makeyour client a bona fide, real-life hero» (1997, p. 164). Sport marketing acade-mics looking to work with sport marketing practitioners should heed that ad-vice. Researchers –and sport marketing academics in particular– can providevaluable third-party validation to provide support for sport marketing programsto important internal constituents, such as chief financial officers and other se-nior-level management at corporate sponsors. Therefore, it is often a goodidea to include an on-site presentation within the research proposal. In addi-tion to demonstrating the value of the program to internal constituents, it pro-vides the vendor with an opportunity to enhance the business relationship.Table 2. Benefits of Research to Sport Sponsors.Evaluation • Determine sponsorship effectiveness and efficiency.• Find out how your sponsorship performs relative to that ofcompetitors.• Calculate return on marketing investment and compare toother marketing communications.• Develop guide for marketing resource allocation.Program Justification • Justify, defend, and increase your budget.Strategic Planning • Determine appropriate sponsorship types.• Identify potential sponsorship relationships.• Allocate resources within sponsorship portfolio.• Develop empirically based support programs.• Determine appropriate leverage spending.• Discover trigger points in fans’ attitudes toward sponsors.SPORT MARKETING CONSULTING STRATEGIES AND TACTICS 17
  8. 8. Tactics for Selling Research to PractitionersThe strategies in the preceding sections will need to be customized to re-flect both the research expertise of the sport marketing academic and theneeds of the prospective client. However, I would like to suggest the follow-ing tactics as practical next steps for sport marketing academics looking toconduct research for the industry.Tap into your existing professional network. Sport marketing academics in-terested in pursuing industry relationships can look to former students work-ing in the field and current students’ internship sites to get connected with in-dustry organizations. Sport marketing academics can also look to colleagues.Irwin (2002) described how, as a second-year assistant professor, he was firstmentored as a consultancy apprentice and later assumed the role of mentorhimself.Use direct marketing. Not every sport marketing academic program bene-fits from a large cadre of successful alumni or a wealth of internship sites.Moreover, research expertise may not be consistent with the academic’s cur-rent professional network. Among sport marketing consultants, a favored busi-ness development technique has been targeted mail campaigns followed bypersonal phone calls.Have a «deck» handy. A «deck» is marketing practitioner parlance for aPowerPoint presentation outlining general capabilities or a specific studyprospectus. The «deck» should be about 10-15 slides and contain the fol-lowing sections:• Description of organization and staff• Background of the study• Benefits of the study• Summary of research objectives/questionnaire• A brief summary of methods• Cost and timelineA «deck» can be a very powerful sales tool. In the case of the NASCARSponsorship Study at the Center for Sports Sponsorship, one client signed on-to the study based solely on e-mail exchanges and a review of the «deck.» Inanother case, I received a phone message from an executive of the client’spublic relations agency. I immediately tracked down the executive’s e-mail ad-dress from the agency website and sent the NASCAR study’s «deck.» Thedeal was finalized within a week. The «deck» needs to be concise and com-pelling because written documents tend to get passed around within organi-zations. For another client on the NASCAR study, the «deck» floated aroundthe organization for about a month until it fell into the right hands, also re-sulting in a partnership.18 SMIJ – VOL. 4, Number 2, 2008
  9. 9. Pricing StrategiesBe aggressive in pricing. Although prices vary substantially depending onthe nature of the work, most market research projects of the type describedin this paper fall into the $ 25,000-$ 50,000 range for smaller boutique agen-cies, or more if they are conducted by a larger market research company. Ifcalculating labor costs on an hourly rate, rates of $100 to $150 would beconsidered fair for an experienced researcher, $ 50 for a graduate student. Al-ternatively, clients could be billed by service. Data analysis and report writinghave a higher value than data entry and report production, even if the sameperson does the work. Weiss (2000) recommended that consultants pursuevalue-based pricing instead of hourly billing. However, since revenue is not di-rectly derived from research efforts, a final «value» is difficult to estimate.Report WritingDraw clear, concise conclusions. Sport marketing practitioners are not in-terested in plowing through the data. They are interested in «what the re-search says.» Researchers need to state conclusions drawn from the study.For example, «the audience has very desirable demographics» is simple butcan be used as a sales tool. Conclusions should be stated at the beginningof the report in an executive summary, which is the most important part of thereport. Keep the methods section brief or include it as an appendix.Keep statistics simple. Unless a client otherwise requests, stick to fre-quencies and crosstabs. While multivariate statistical analysis is often valuablein identifying relationships, and therefore very useful in analyzing results, theyshould be included in reports judiciously so as to avoid confusing clients.Maintaining and Building Industry RelationshipsConducting market research for sport marketing practitioners can be an ef-fective method in establishing relationships with the industry but it can alsolead to other consulting opportunities in areas such as proposal preparationand conducting sales campaigns. Market research conducted by industry ven-dors usually ends with a report. Too frequently, the report ends up gatheringdust on a shelf in someone’s office. Retainer-type relationships in which anindustry vendor provides research consulting to a sport-related organizationcan be prohibitively expensive for the organization. As an alternative, sportmarketing academics might supply sport properties with research to be in-cluded in sponsorship proposals, perhaps as a student project. Or, sport mar-SPORT MARKETING CONSULTING STRATEGIES AND TACTICS 19
  10. 10. keting academics might provide corporate sponsors with ad hoc «white pa-pers» based on existing research.Once relationships are formed, opportunities for other consulting activitiesshould arise. Marketing and ticket plans are natural extensions of fan surveys.Sponsorship evaluation can lead to sponsorship plans, promotional strategies,and even promotional execution. Assisting practitioners with proposal prepa-ration could lead to actually conducting sales campaigns. While the scope andnature of the relationships obviously depend on academic expertise and re-sources, and practitioner needs, research can provide an effective entry pointto establishing relationships with the industry.ReferencesIrwin, R. (2002). Engineering the theory-to-practice bridge using the consul-tancy approach. Sport Marketing Quarterly, 11, (2), 121-123Spoelstra, J. (1997). Ice to the Eskimos. New York: HarperBusinessStotlar, D. (2004). Sponsorship evaluation: Moving from theory to practice.Sport Marketing Quarterly, 13, (1), 61-64Weiss, A. (2000). Getting Started in Consulting. New York: John Wiley &Sons, IncAddress for correspondence:Larry DeGaris1400 E. Hanna Av.,IN 46204, IndianapolisUSAe-mail: degarisl@uindy.edu20 SMIJ – VOL. 4, Number 2, 2008