Thursday, February 18, 2016

Decisions Facing MLB Show Marketing is an Outside-In Process

Image Credit: ABC News
Baseball is known as America's pastime. It is a game that recently celebrated its 140th birthday. Thousands of players have played professional baseball since Abner Doubleday introduced baseball in 1876. Moreover, generations of fans have followed the sport, with family members often passing down team loyalties from generation to generation. These characteristics of baseball bring out its timeless appeal, but they also carry less desirable connotations such as "old" or "outdated." Old and outdated are not necessarily compatible traits with a young audience coveted by Major League Baseball. 

What to do? MLB must do what every organization is forced to encounter: Take an outside-in approach to decision making. The outside part of outside-in is monitoring of the external environment; the in part of outside-in is making marketing decisions in response to what is learned from the external environment.

Millennials up to Bat

In Chapter 3 of Sports Marketing, socio-demographic trends are identified as factors in the external marketing environment, or those forces occurring outside the organization that cannot be stopped or changed. Specifically, the growing importance of the Millennial generation is a socio-demographic trend that has the potential to significantly affect most businesses, including Major League Baseball. 

Pew Research classifies Millennials as persons borne between 1981 and 1997. This population group totaled 75.3 million people in the U.S. in 2015, surpassing the 74.9 million Baby Boomers (persons born between 1946 and 1964). Millennials' importance as a population group will only continue to grow with immigrants boosting the number of Millennials in the coming years as projected in the chart below.

Image Credit: Pew Research

Marketers must be cognizant of trends like the rise of the Millennials. More importantly, they must develop strategies to respond to the trends. According to a USA Today article, the average age of MLB's TV audience was 56 years-old in 2015. The average age of MLB app users fell in the upper end of the Millennial generation at 34 years-old. If MLB maintains status quo and does not adapt it products to younger consumers, it is possible they will become less relevant to Millennials.

MLB to Swing for the Fence?

To its credit, MLB is on top of the shift toward a younger audience. It is aware of the shift and must now respond with marketing strategies that plays favorably to Millennials. One popular notion is that the pace and speed of a baseball game is too slow to keep the interest of young people. Thus, MLB is considering ideas for shaking up the status quo. MLB hired Hall of Fame infielder Cal Ripken Jr. as a special advisor to come up with ideas to innovate the game. Among the ideas pitched (pun intended):
  • Instead of an inning three outs in an inning, how about five batters?
  • What if every inning started with the batting team having a runner on first base?
  • Should players be required to attempt to steal a base?
You may have read enough if you consider yourself a baseball purist- how dare they tinker with a classic game! But, MLB must at least consider such innovations to the product if it thinks today's customer will find value in it. Doing things the way they have always been done is not an acceptable business strategy in any industry, particularly when the market from which you attract customers is transforming as it is in the United States.

MLB's Strategy?

Baseball is revered by many people because of the strategic competition it can become, two teams making player adjustments and other moves in an attempt to gain the upper hand. MLB would be well-served by adopting the same approach as it scans the external marketing environment to determine how to respond to trends such as the rise of the Millennial population.

What trends in the external environment do you see as most important that MLB recognize and respond to them? 

Thursday, February 11, 2016

Does College Football Have an Attendance Problem?

The pageantry of college football makes it one of the most compelling sports to attend in person in the United States. Tailgate parties, marching bands, cheerleaders, and more are staples of game day atmosphere on campuses across the country. The experience of attending a college football game sets the sport apart from other collegiate sports as well as its professional counterparts. College football has one other unmistakable trait associated with it: Declining attendance. 

An Observable Trend

Attendance figures compiled by the NCAA reveal a slow but steady decline in average game attendance. The average number of fans taking in a game at the Football Bowl Subdivision (FBS) level has decreased 6.4 percent over the past decade, with the average of 43,288 fans being just under 3,000 fewer fans than on average ten years ago. Many sport properties that saw attendance declines in the wake of the 2008 economic recession would cite the economy as a reason for such a drop. However, a review of annual attendance figures suggests a gradual drop not caused by a single external factor like the economy.

Attendance figures show fewer fans showing up for football games. However, the question begging for an answer is "why." Unfortunately, the answer is a complex one.

Factors Influencing Attendance

In Chapter 2 of Sports Marketing, a framework  is presented for sporting event attendance. The model, developed by sport consumption researcher Daniel Wann and colleagues, identifies four influences on direct sport consumption:

  • Perceived options- Includes future availability to consume, financial requirements, parking, weather, day and time of event
  • Team or sport identification- Extent to which one is a fan of the sport played or team playing
  • Personal incentives- Interest in characteristics of a sport (e.g., fighting in hockey) or desire for socialization with others
  • Marketing incentives- Amenities offered in a venue or promotional tactics intended to influence attendance (e.g., t-shirt giveaway).
Known as the Theory of Personal Investment, the model suggests that attendees are motivated by different factors. Some attendees are influenced most by the sport or team, which might be an obvious influence. But, there are other attendees who may have less interest in the teams playing than in the chance to spend a few hours having fun with family or friends. Also, a person may make the decision not to attend at all, particularly if indirect consumption is an option, especially watching an event on television. There are no lines for food or restrooms, it is climate controlled, and inconveniences like parking and traffic are nonexistent.  

Short-Term Slip or Permanent Shift?

What are your thoughts about attendance trends in college football. Interest in the sport remains strong, so is it only a matter of time before attendance increases? Or, is the gradual decline in average attendance over the past decade the new normal in college football, with perhaps more years of decline in store? Moreover, what can sports marketers do to entice people to return to stadiums on Saturdays using marketing incentives?

Wednesday, January 20, 2016

It All Begins with Positioning

When you think about the practice of marketing, functions such as advertising, sales, and product development likely come to mind. These elements are essential to marketing execution, but they must follow another crucial task: Understanding customers. The American Marketing Association defines marketing as:

"the activity, set of institutions, and processes for creating, communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large."

It is not possible to create, communicate or deliver value without first knowing customers and the effects of the marketing environment on customers and the organization. In turn, this insight equips an organization to create, communicate, and deliver what will please customers while benefiting the organization.

What is Positioning?

In Chapter 1 of Sports Marketing, positioning is identified as one of the five Ps of the sports marketing mix. It is no coincidence that positioning is placed in the center of the graphic below. Why? Positioning must be the center of all marketing activity. Any decisions made without a firm grasp on needs and wants of the market are risky, at best.

Positioning as used in the sports marketing mix is different than the usual definition of the term positioning, which refers to a point of difference a brand holds relative to competition in customers' minds. In the sports marketing mix, positioning is all about understanding customers, in effect enabling an organization to position itself to carry out the definition of marketing. Decisions impacting the other four Ps (platform, promotion, people and profits) should be based on the understanding of customer consumption, the external marketing environment, and market segmentation resulting from analyzing the customer and external environments.

Gatorade: Reinventing through Positioning

A sound marketing decision can ultimately be traced back to an organization's positioning efforts. An example of this connection is how Gatorade is developing the next generation of sports drinks. Gatorade is an iconic brand that invented the sports drinks category. However, declining sales and competition from brands outside the sports drink category like Red Bull, Monster, and Vitaminwater have led Gatorade to revisit the positioning element of its marketing.

Gatorade is looking to create value for athletes by incorporating technology to help determine optimal quantity of fluid intake as well as the appropriate levels of carbohydrates, calories, and electrolytes given an athlete's individual needs. Check out this video from Gatorade on how it partnered with Brazil's national soccer team to deepen its understanding of users and translate it into better product offerings.

Gatorade can leverage its positioning efforts to pursue additional opportunities beyond improvements in sports drinks. The company is targeting other food products to market that fulfill the same desire of fueling one's body for optimal performance.

Other Examples?

Can you identify an organization or brand that excels at managing the positioning element of the sports marketing mix to uncover and pursue business opportunities?

Tuesday, January 12, 2016

The NFL's Affinity Advantage

Think of the brands that you have a relationship with as a customer. For how many of those relationships would you tolerate inconsistent product quality, safety hazards, rising prices, and negative publicity about a company's employees? Most of us would likely discontinue doing business with that company and find another source to meet the need that the offending company provides. Yet, the National Football League seems immune to the pitfalls that would drive many customers away.

The NFL has been associated with a long list of negative press related to player conduct off the field, player safety on the field, owners' quest for revenue, and top leadership that seems out of touch. Yet, brand NFL appears to be as popular as ever. Evidence of the NFL's popularity can be found in its TV ratings- nearly all of the top rated TV programs this fall were NFL game broadcasts. And, the NFL has consistently ranked as the most popular sport among Americans in an annual Harris Poll. How does the NFL overcome the missteps that would doom many brands? In a word, it is "affinity."

What is an Affinity Advantage?

Affinity has been defined as "an attraction to or liking for something." Sports enjoy what is described in Chapter 1 of Sports Marketing as an affinity advantage. Many customers (fans) of sports brands have a liking that is much deeper and more intense than other brand relationships they have. Let's face it, you don't see people showing their affinity for Whirlpool  (appliances) or Timex (watches) by wearing caps or t-shirts adorned with those brands' logos. Most consumers do not have such a deep connection with the brands they consume everyday that they want to express to others their feelings about their favorite toothpaste or auto insurance. 

Implications of Affinity

Sports brands are the envy of marketers in most other industries because of their affinity advantage. If only they could have customers as passionate as fans that pay premium prices to watch games in frigid cold or heavy rain. You could say that sports brands enjoy a head start  over their non-sports counterparts. But, the affinity advantage alone does not translate into business gains. It is up to sports brands to leverage their advantage by seeking revenue opportunities that enable fans to act on their affinity. At the same time, these opportunities can advance the brand not only by generating revenue but by deepening customer relationships.

And, leveraging the affinity advantage is not limited to sports properties. Other businesses can tap sports to develop new product offerings. An example of leveraging fan affinity as business opportunity is the recently announced comic book featuring Seattle Seahawks quarterback Russell Wilson. Portland-based STORM Comics is publishing "Fame: Russell Wilson"in print and digital formats. The work chronicles Wilson's rise to one of the NFL's top quarterbacks. 

It would make for interesting discussion to consider new products that could be created to take advantage of the affinity sports fans have with their favorite teams and athletes. What other opportunities exist to appeal to fan affinity?

Thursday, January 7, 2016

If You Give Fans a Voice, They Will be Heard

The All-Star Game product devolved into a stale product for the four U.S.-based major professional sports leagues. The NFL, NHL, NBA, and MLB all were put into a position of how to make the games more relevant to players and and fans alike. The NBA, NHL, and MLB have enhanced the game event by holding skills competitions the day before the All-Star Game. And, digital media has been used to give fans easier access to voting for game participants.

The NHL tinkered with its All-Star Game format for 2016 with two significant changes. First, the two conference teams (Eastern and Western) are replaced with four division teams (Atlantic, Metropolitan, Central, and Pacific) that will compete in a tournament. Second, the traditional five-on-five game is being ditched in favor of three-on-three contests, which is the same format used in the league's five-minute overtime period beginning this season. Fans were given the task of voting for captains for each of the four teams. The remaining forty players would be selected by the NHL.

Not Your Typical ASG Captains

Fan voting for All-Star Game captains took place during the period December 1 to January 1. The NHL periodically announced the leaders for each division. The leader board included familiar names to even the most casual hockey fan- Jaromir Jagr (Atlantic), Alex Ovechkin (Metropolitan), and Patrick Kane (Central). John Scott of the Arizona Coyotes emerged as the vote leader for the Pacific Division. If you have never heard of John Scott, it is understandable. As of January 1, his career stats included:
  • 5 goals
  • 6 assists
  • 542 penalty minutes
This season, Scott played in 11 games, had one assist, has been placed on waivers three different times, and spent time with the Coyotes minor league team. When the voting ended January 1, Jagr, Ovechkin, Kane, and yes, John Scott were named team captains for the 2016 NHL All-Star Game.

Farce or Fabulous?

John Scott's on-ice performance may not have been All-Star material, but the impact of social media propelled Scott to the top of the list for Pacific Division captain. Fans took to Twitter using the hashtag #VoteJohnScott during December to float the idea of voting in an unorthodox candidate as a captain. Similarly, fans used #VoteJohnScott on Instagram to promote their favorite tough guy. Some people believe Scott's supporters intended to make a mockery of the captain selection process, if not the All-Star Game itself. Could the league have stepped in or otherwise engineered a different outcome? 

Image Credit:
John Scott is certainly not a typical choice for an All-Star team captain (or even an All-Star player), but his selection speaks to the power of giving fans a voice. After all, what is the criteria for designating a player as an All Star? Is it based on current performance? Historical performance? Is it based on statistical performance or a more holistic view of a player and his game? NHL executives probably did not think they would be faced with this outcome. The decisioin was made to put captain selection in fans' hands. The fans spoke, and they have two All Stars in their prime (Ovechkin and Kane) a 43-year-old veteran enjoying a remarkable season (Jagr), and Scott. 

Community versus Control

In the end, the NHL did the right thing by giving its community input into crafting the product that is the NHL All-Star Game. The outcome of fan voting provided fuel to cynics that contend all-star games are pointless and should be eliminated, but then again no outcome would likely sway that group. The selection of a little used player as an All-Star team captain serves as a reminder that when a brand turns over some decision making or input to its community, it is ceding some control. This trait of a brand community is unsettling to some marketers (and their legal departments) that seek to control every aspect of their brand.

Do you think the NHL All-Star Game brand image is negatively impacted by the captain selection process, or did it benefit the NHL brand in any way?

Monday, January 4, 2016

The One Question that Simplifies Content Marketing

Outside of social media, no other practice has garnered as much attention (and consternation) among marketers than content marketing. You may have heard the term or read about the growth of content marketing, but you may be unclear exactly what it is. A definition offered by the Content Marketing Institute, an authoritative source on trends and best practices, is:

“Content marketing is the marketing and business process for creating and distributing relevant and valuable content to attract, acquire, and engage a clearly defined and understood target audience – with the objective of driving profitable customer action.”

OK- CMI’s definition of content marketing may be a mouthful, but it should be thought of as using content (information or entertainment-based) to influence a target audience at various stages in the sales funnel. While the use of content is hardly new- information delivered in formats such as product brochures and case studies have been around for years- the channels available to deliver content precisely and on demand have grown significantly. Email, podcasts, social networking sites, and website landing pages are relative newcomers to the menu of content delivery options.

A Dearth of Content

The ease of content creation and distribution has led to a significant increase in content produced… but no more time in the day for a person to consume content. Also, content production has increased as brands seek to stay a step ahead of competitors. The resulting glut of content has been labeled “content shock” by marketing expert Mark Schaefer. Evidence of content shock cited by Schaefer includes data from Nielsen that indicates that a person’s content consumption has grown from two hours per day in the 1920s to eleven hours per day. Do you see any signs of that figure decreasing? Me neither.

Our appetite for content is fueled by the ability to consume anytime on any device. The ubiquitous nature of our Internet connectivity coupled with competitive pressures to reach consumers where they are leads to more content creation. The amount of marketing content created will likely continue to grow, with one piece of evidence being Content Marketing Institute data that reveal eighty-eight percent of B2B marketers and seventy-six percent of B2C marketers use content marketing. Content quantity is growing, but what about quality and more importantly, effectiveness?

One Question Can Deliver Valuable Content

As marketing content becomes more prevalent, the result will be a more cluttered environment, if not the content shock Mark Schaefer described. How does a brand make its content stand out in today’s crowded content landscape? The answer is relatively simple: Give your customers content they want. The way to make that happen is even simpler: Ask them what they want.

Golf equipment maker Titleist did just that. In mid-December, Titleist used its Twitter account to ask followers a very straightforward question: What type of content would you like to see more of in 2016?

Titleist used a Twitter poll to gather feedback and received more than 1,500 responses. The content users want to see the most? Behind the scenes stories (36%) followed by instruction (25%), tour features (23%), and R&D stories (16%).

The power of asking what content Titleist’s community valued cannot be overstated. Too often, marketers assume to know what will resonate with their customers. In this case, it may have been tempting to make the assumption that golfers would find content related to Titleist’s R&D efforts interesting. Although they may indeed find such content interesting, Titleist found out that other content themes would be of greater interest. Asking simple questions can yield valuable insights.

Find Content Inspiration in Other Obvious Places

Customers and brand community should always be tapped as a source of ideas for creating marketing content, as Titleist did. Besides directly asking for input, here are three other ways to determine content themes:

Customer inquiries – Phone logs and the email inbox can be helpful in identifying content topics. What are customers asking about when they call or write? What questions or problems tend recur in customer support channels? Content adds value by educating people or helping solve their problems.

Sales force – A company’s sales reps are on the front lines dealing with buyers. Whether the buyer is the end user or an intermediary that sells to end users, sales reps can learn from them what content types would create value when making a buying decision, using the product, or both.

Social media monitoring – Similar to sales reps having their ear to the ground to learn from customers and prospects, social media monitoring can give marketers a glimpse into what is relevant to their audience. What topics are they discussing? What are their aspirations? Their frustrations?

Always Room for Useful Content

Mark Schaefer could be right about impending content shock. The prospect of an oversaturated market for information should be a call to up brands’ content game. Creating and distributing content is easier than ever; that ease also makes it harder than ever to reach and engage through content. That challenge should not dissuade marketers from committing to a content marketing strategy. On the contrary, now is the time to be more intentional about the role content plays in overall marketing strategy for an organization.