unit 5 – the marketing plan copyright © 2010 by sports career consulting, llc

Unit 5 – The Marketing Plan

Copyright © 2010 by Sports Career Consulting, LLC

The Marketing Plan

UNIT 5 OBJECTIVESUNIT 5 OBJECTIVES

1)Understand what the marketing plan and why it is an important tool for sports and entertainment marketers

2)Identify the key components of the marketing plan

3)Successfully compose a mission statement

4)Explain the purpose of a situation or SWOT analysis


The Marketing Plan

UNIT 5 OBJECTIVESUNIT 5 OBJECTIVES


5) Identify the four elements of a situation analysis

6) Recognize the importance of understanding the financials within the marketing plan

7) Determine which information is important to address within the marketing plan


Lesson 5.1 –

What is the Marketing Plan?

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The Marketing Plan


What is a marketing plan and why are they important to sports and/or entertainment organizations?

Discussion Topic

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The Marketing Plan


Marketing Plan:

A written document that provides direction for the marketing activities for a specific period of time


It is a critical planning tool for any business, regardless of industry

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The Marketing Plan


Provides direction for the organization by defining goals and strategies

Sports organizations consider this process the creation of a business “game plan”

It communicates the goals, objectives, and strategies of a company to its employees

Marketing Plan


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The Marketing Plan


The Marketing Plan

Some marketing plans are prepared to be included as part of a complete business plan with the goal of obtaining financing from outside investors or bank for a new venture

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The Marketing Plan

Complexity and Time Frame

The complexity of the plan is determined by the size and type of the organization

The plan is also influenced by the organization’s goals and objectives



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The Marketing Plan

Complexity and Time Frame

The time period covered by the plan also varies with organization size and type

A minor league sports franchise will probably create a short term plan while a major league team will create a long term plan



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The Marketing Plan

Understanding the Market

The product

The consumer

The economy

Target markets

Existing market distribution channels

Buying trends

Competitor performance



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The Marketing Plan


Competition refers to a rivalry between two or more businesses selling products or services to the same customers or markets


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The Marketing Plan



When two or more businesses sell the same goods or service, they are competing for the same consumers. Competition impacts price points, product features and marketing strategies because businesses are fighting for an edge that will persuade consumers to choose their products or services over those of competitors.

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The Marketing Plan


A monopoly occurs when there is no competition in the marketplace


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The Marketing Plan



Google has digitized millions of out-of-print books and has reproduced them online for consumers to read. However, because there is a lack of competition because nobody else has access to many particular titles, the book service raises monopoly and privacy concerns and is being reportedly reviewed by the U.S. Department of Justice.

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The Marketing Plan



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In 2010, FCC regulators voted to close a loophole in federal law that gave Cox Communications exclusive rights to San Diego Padres broadcasts, opening the door for rivals such as AT&T and DirecTV to eventually include Padres games in their channel lineups. Said Mark Kersey, a cable industry analyst, “The FCC clearly looked at this data and concluded the lack of Padres games has impeded competition.”

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The Marketing Plan


Direct competition occurs between sellers of similar products and services

Indirect competition occurs between sellers that compete for the same share of

consumers’ discretionary income (competition for the entertainment dollar)

Types of Competition


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The Marketing Plan



Li Ning, an upstart Chinese footwear and apparel brand is a direct competitor of Nike, Adidas, Puma and Under Armour, has already displaced Adidas as the number two brand in China based on sales of footwear, apparel and accessories. The company is positioning itself to surpass Nike as the top footwear and apparel brand in China. Li Ning’s goal is to be number one by 2013.

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The Marketing Plan



It is possible for some products and services to compete directly at times and indirectly at others

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The Marketing Plan


Substitute Products:

products (or services) that consumers may choose to use rather than a particular company’s product


Watching games in HD on television rather than attending the game in person


Lesson 5.2 - Components of an Effective Marketing Plan

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The Marketing Plan

Key components of an effective marketing plan:

1) Mission Statement

2) Executive Summary

3) Situation or S.W.O.T. Analysis

4) Marketing Goals / Objectives

5) Market Research / Marketing Strategies

6) Implementation

7) Evaluation and ControlCopyright © 2010 by Sports Career Consulting, LLC

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The Marketing Plan

Key components of an effective marketing plan (could also include):

1) Table of contents

2) Problem identification statement

3) Communication and/or publicity plan


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The Marketing Plan

The majority of marketing strategies are founded on the basis of the mission statement content

The Mission Statement

Mission Statement:

A written statement that captures an organization’s purpose, customer orientation and business philosophy


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The Marketing Plan

The executive summary highlights key information within the document

The Executive Summary

Executive Summary:

Provides an overview of the complete plan


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The Marketing Plan

SS

WW

OO

TT

Strengths

Weaknesses

Opportunities

Threats

The Situation (S.W.O.T.) Analysis


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The Marketing Plan

Marketing Goals & Objectives

Goals and objectives identify what the company hopes to achieve with the marketing plan and a timeline for which the plan is to be carried out

Why are goals and objectives important?


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The Marketing Plan

Marketing Goals & Objectives

Effective objectives follow the S.M.A.R.T criteria


Specific

Measurable

Action-oriented

Realistic

Time bound

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The Marketing Plan

Market research / Marketing strategies

1) Defining a specific marketing approach intending to create segmentation and positioning objectives with the goal of influencing consumer purchase decisions

2) Plan should include any relevant market research to help support strategy and implementation decisions

3) Developing a strategy includes the process of designing an initial marketing strategy for a new product based on the product concept


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The Marketing Plan

Implementation


Implementation refers to the process of putting the marketing plan into action

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The Marketing Plan

Evaluation and Control


The evaluation phase determines whether the plan achieved the desired results

The controlling process refers to the adjustments required to achieve desired results where initial efforts did not already succeed


Lesson 5.3 –


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The Marketing Plan

What business are we currently in?

Who are our current customers?

What is the scope of our market?

How do we currently meet the needs of our customers?


The mission statement should address the following questions:


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The Marketing Plan

Be shared with and supported by company employees

Explain why the organization exists and what it hopes to achieve


To be effective, the mission statement should also:


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The Marketing Plan


“Olympic marketing helps perpetuate the work of the Olympic Movement, by providing resources, programmes and financial support. All programmes and actions of a partner should be designed to enhance and protect the Olympic image and Olympic values.”

Mission Statement:

International Olympic Committee

marketing commission

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The Marketing Plan


“The International Skateboarding Federation (ISF) is formally organized and incorporated as Skateboarding’s International Federation and World Governing Body. The ISF has been established to provide direction and governance for the sport of skateboarding worldwide; The ISF’s goals include but are not limited to:

* To make skateboarding available to everyone in the world who wishes to participate,

Mission Statement:

Mission statement of the International Skateboarding Federation

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The Marketing Plan


* To guarantee skateboarding continues to provide the freedom of self-expression and creativity,* To promote and support the sport of skateboarding in order to guarantee its future,* To continue to maintain the integrity and authenticity of skateboarding as a sport, a passion and a lifestyle,* and to apply these rules of governance in a fair and equitable way, and to do so through the leadership and expertise of the skateboarding family world-wide”

Mission Statement:

Mission statement of the International Skateboarding Federation

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The Marketing Plan


“The Lance Armstrong Foundation (LAF) inspires and empowers people affected by cancer. We help people with cancer focus on living; we believe that unity is strength, knowledge is power and attitude is everything. From the moment of diagnosis, the LAF provides the practical information and tools people with cancer need to live life on their own terms.”

Mission Statement:

Lance Armstrong FoundationLance Armstrong Foundation


Lesson 5.4 – The

Situation Analysis (SWOT)

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The Situation (S.W.O.T.) Analysis

SS

WW

OO

TT

StrengthsResources and capabilities that can be used as a basis for developing a competitive advantage

WeaknessesQualities that give a business a competitive disadvantage

OpportunitiesEvents that could facilitate company profit and growth

ThreatsEvents that could have a negative impact on the company


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Situational (S.W.O.T.) Analysis

WeaknessesStrengths

ThreatsOpportunities


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SSStrengthsResources and capabilities that can be used as a basis for developing a competitive advantage

Examples of strengths include:

Patents

Strong brand names

Positive reputation among customers

The Situational (S.W.O.T.) Analysis


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The Marketing Plan

WW WeaknessesQualities that give a business a competitive disadvantage

Examples of weaknesses could include:

Lack of patent protection

Weak brand name

Poor reputation among customers

Lack of resources

Inadequate distribution channels



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The Marketing Plan


OO OpportunitiesEvents that could facilitate company profit and growth

Examples of opportunities could include:

An unfulfilled customer need

Arrival of new technologies

A niche that has not yet been exploited

Mergers

Entry into new markets


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TT ThreatsEvents that could have a negative impact on the company

Examples of threats could include:

Shifts in consumer tastes away from company products

Emergence of new substitute products

Government regulation



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As a hypothetical example, let’s say you were conducting a SWOT analysis for an apparel and footwear company competing with companies like Nike, Adidas and Under Armour for market share


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SSStrengthsResources and capabilities that can be used as a basis for developing a competitive advantage

Strengths might include:

Steady and consistent growth in profits

Innovative new technology (lightweight, stretchable fabric) that increases consumer performance

Products tied to effective endorsement campaign (Serena Williams wears your new technology during games)



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The Marketing Plan

WW WeaknessesQualities that give a business a competitive disadvantage

Weaknesses might include:



Too much reliance on sales of products online and not enough in retail environments (your products are not available at Dick’s or Foot Locker)

Low brand awareness (not enough consumers are familiar with your brand)

Dependency on sales of apparel products with a track record of limited growth in footwear (75% of total sales come from the apparel category)

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Opportunities might include:


Well defined objectives with company-wide support (everyone in the company is behind the goal of increasing footwear sales in the next fiscal year)

Positive industry outlook (forecasts call for substantial growth in the footwear and apparel markets for the next three to five years)

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Opportunities might include:


Positive association with endorsers (Serena Williams’ popularity is extremely high and he uses your product and will be featured in an upcoming campaign promoting the brand)

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TT ThreatsEvents that could have a negative impact on the company

Threats might include:



Competitors launching new, similar product (Puma is launching a similar lightweight, stretchable fabric apparel line in the upcoming year)

Rising raw material prices (the cost of producing products will rise)

Poor economic conditions (consumers are spending less)


Lesson 5.5 - Financing

The forecast predicts the costs and expenses as well as anticipated revenue


UNIT 4

Marketing Applications

Financing

The budget details the financial impact of each part of the marketing plan


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Financing

The balance sheet indicates the current value of the company


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Financing

The income statement is a record of profit and loss that identifies all revenues and expenses


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Financing

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Financing Example


One of the key challenges facing the athletic department from a financial perspective was the fact that away football games placed a severe strain on the budget

The University of Richmond football team’s operating budget for 2008 was $450,000

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Primary revenues included:

1) Corporate sponsorship

2) NCAA revenue distribution

3) Ticket sales

4) “Guarantee games”

Financing

University of Richmond Football Revenues

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1) The football team’s travel to the Virginia Military Institute in 2008 cost about $16,000

2) Costs were lower when the team played University of Virginia because it did not spend the night, instead opting to return home late that night

Financing

Spiders Football Travel Expenses

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The Marketing Plan


Financing

Spiders Football Travel Expenses

Travel becomes much more expensive when the team is required to fly rather than drive, as evidenced by the $65,000 expense incurred when Richmond traveled to play UMass

1) Air travel was $48,000

2) Food was $7,000

3) Lodging was $6,000

4) Bus transportation was $4,600

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Financing

Spiders Football Budget Outcome

In the future, athletics will look for ways to minimize travel expenses to stay as close to budgeted travel costs as possible

1) Richmond has some control over the schedule, so each road trip is evaluated on whether it fits the budget, ease of reaching the destination, game times and availability of commercial flights

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Financing

Spiders Football Budget Outcome

In the future, athletics will look for ways to minimize travel expenses to stay as close to budgeted travel costs as possible

2) The program also looks to alliances with partners such as Nike and different hotel chains as a means for minimizing expenses through discounts to try to remain within the budget

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Financing

Financial Obligations of Athletics

State-run Universities in the state of Oregon are required by law operate profitably

In 2009, both Oregon State University and the University of Oregon ran a deficit, and the state

legislature demanded they come up with a plan to bring their budgets to reflect positive cash flow

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Financing

Primary sources of sport-generated revenues for these schools

1. Gate receipts

2. Television and radio payments

3. Contributions (alumni, foundations, other)

4. Student fees

5. Sponsors and other advertising

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Financing

Financial Obligations of Athletics

The most fickle element of the revenue picture is the economy’s impact on donations from alumni and other sources. In a recession,

this group tends to cut back heavily on contributions, consequentially have an adverse impact on the University athletic programs.


Lesson 5.6 – Key Information

in the Marketing Plan

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The Marketing Plan

Key Information in the Plan

Product Planning

Marketing-Information Management

Distribution System

Pricing

Promotional Strategies

Companies must be thorough and detailed when including key information in their marketing plans


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Key Information in the Plan

Financing

Risk Management

Sales / Selling

Execution Strategy

The Future

Companies must also consider numerous additional factors when creating their marketing plans


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Product Planning

What event, product, or service will be

researched, developed, marketed and

ultimately sold via a pre-determined

distribution channel?

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Marketing-information Management

Who are the company’s competitors?

Who are potential customers?

What characteristics define the target market?

What motivates consumers to buy?

How do we insure repeat purchases?

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Distribution Strategy

How will the company’s product get to the consumer?

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Pricing

How much does the product cost the company to produce?

What is the optimal price for the product?

What is the estimated demand?

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How will the company integrate an effective promotional mix into the plan?

What forms of advertising will they use?

Will those decisions be cost-effective?

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Financing

What is the projected overall revenue?

What costs are involved?

What economic conditions will influence marketing efforts?

What other factors should be integrated within the budget?

What is the time frame that should be considered?

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Risk Management

What legal liability could the company face?

What laws could affect marketing strategies?

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Sales

What sales strategy will be employed?

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Execution strategy

How will the plan be carried out in a manner that will allow for the organization to accomplish its goals and objectives?

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Execution Strategy

Sampling of Vancouver Organizing Committee for the 2010 Olympic Games implementation strategy

1) Create awareness and excitement, across Canada, of the Olympic and Paralympic movements and the 2010 Games

2) Make the Games relevant to the entire country fostering the spirit of Canada’s Games

3) Generate interest and excitement in the corporate community

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Execution Strategy

Sampling of Vancouver Organizing Committee for the 2010 Olympic Games implementation strategy

4) Target companies and industries that are profitable and can afford the required investment levels

5) Create opportunities for sponsors to activate their sponsorships and maximize their return on investment throughout the entire term of the sponsorship agreements

6) Create a positive image and build a solid reputation of fiscal responsibility

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The Future

Where is the business going?

What is the future for company competitors?

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Plan Information Example

Let’s assume you are an executive working for sports drink maker Gatorade

Example of key information addressed in a marketing plan (hypothetical)

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Product Planning

Before Gatorade makes the decision to introduce any new products to the market, they

must first develop a marketing strategy to help maximize

beverage sales. They must also consider how to market

existing products.

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The Marketing Plan


Marketing-information Management

Gatorade must evaluate each of their competitors (VitaminWater, Powerade etc.)

Identify the target consumers

Understand how those make purchase decisions

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Distribution Strategy

Will Gatorade utilize a mail order strategy through EastBay?

Will they create an online shopping portal to sell online? Provide product at retail stores?

Which combination of distribution channels best fits their overall sales strategies?

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Pricing

What beverage production costs be?

What range of potential price points makes sense for the product(s)?

Will any discounting strategies be implemented?

What type of demand can be expected for the new sports drink products at each of the price variations?

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What will Gatorade’s promotional campaign include? What type of media will be utilized to communicate information about the shoe to consumers? Social media? Advertising? Endorsements? What will the budget be? Which promotional mediums will provide the best bang for the buck?

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Financing

How much beverage (volume) will Gatorade expect to sell?

What is the forecast for gross income?

What costs will Gatorade incur? Manufacturing? Packaging? Distribution? Inventory? Marketing? What is the projected net profit?

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Risk Management

Are there potential legal ramifications for Gatorade’s planned marketing strategy?

Does the product pose any physical risk to consumers?

Is there a risk of consumers getting sick from drinking the beverages?

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Sales

What sales strategy will help Gatorade to maximize the sales volume of the sports drinks?

Personal selling?

Online sales?

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Execution Strategy

How will the plan be carried out in a manner that will allow for Gatorade to accomplish its goals and objectives?

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The Future

What are the short term and long term goals for Gatorade?

What does the future hold for companies like VitaminWater and Powerade?

Are other beverage companies a potential threat in Gatorade’s product category? Why or why not?

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Blank Slide Available

for Teacher Edits


The Marketing Plan

UNIT 5 REVIEW (ANSWERS)UNIT 5 REVIEW (ANSWERS)

1)Understand what the marketing plan and why it is an important tool for sports and entertainment marketers

The marketing plan is a written document that provides direction for the marketing activities for a specific period of time. The plan is a critical planning tool as it provides direction for the organization by defining goals and strategies.


The Marketing Plan


2) Identify the key components of the marketing plan

1- Mission Statement

2- Executive Summary

3- Situation or S.W.O.T. Analysis

4- Marketing Goals / Objectives

5- Marketing Strategies

6- Implementation

7- Evaluation and Control

(Could also include a Table of Contents, Problem ID statement or communications/publicity plan)


The Marketing Plan


3)Successfully compose a mission statement

The mission statement should address the following questions:

What business are we currently in?

Who are our current customers?

What is the scope of our market?

How do we currently meet the needs of

our customers?Copyright © 2010 by Sports Career Consulting, LLC

The Marketing Plan


4) Explain the purpose of a situation analysis

The situation analysis provides information that is helpful in matching an organization's resources and capabilities to the competitive environment in which it operates by reviewing four key factors pertaining to the company’s current market situation (strengths, weaknesses, opportunities and threats).


The Marketing Plan



5) Identify the four elements of a situation analysis

1- Strengths

2- Weaknesses

3- Opportunities

4- Threats

The Marketing Plan



6) Recognize the importance of understanding the financials within the marketing plan

The key financials included in a marketing plan are the forecast, budget, balance sheet and income statement.

Organizations use that financial information to make important marketing decisions.

The Marketing Plan



7) Determine which information is important to address within the marketing plan

Product planning, marketing-information management, distribution system, pricing, promotional strategies, financing, risk management, sales/selling and forecasts for the organization’s future are all integral components of the marketing plan.

End Unit 5


unit 5 – the marketing plan copyright © 2010 by sports career consulting, llc

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