CHAPTER	6

Segmentation, targeting, and positioning

Market selection decisions are the most critical elements of the strategic sports marketing process. In this portion of the planning phase, decisions are made that will dictate the direction of the marketing mix. These decisions include how to group consumers together based on common needs, whom to direct your marketing efforts toward, and how you want your sports product to be perceived in the marketplace. These important market selection decisions are referred to as segmenting, targeting, and positioning (STP). In this chapter, we examine these concepts in the context of our strategic sports marketing process. Let us begin by exploring market segmentation, the first of the market selection decisions.

Segmentation

Not all sports fans are alike. You would not market the Xtreme Games to members of the American Association of Retired People (AARP). Likewise, you would not market the PGA’s Champions Tour to Generation Xers. The notion of mass marketing and treating all consumers the same has given way to understanding the unique needs of groups of consumers. This concept, which is the first market selection decision, is referred to as market segmentation. More specifically, market segmentation is defined as identifying groups of consumers based on their common needs.

Market segmentation is recognized as a more efficient and effective way to market than mass marketing, which treats all consumers the same. By carefully exploring and understanding different segments through marketing research, sports marketers determine which groups of consumers offer the greatest sales opportunities for the organization.

If the first market selection decision is segmentation, then how do sports marketers group consumers based on common needs? Traditionally, there are six common bases for market segmentation. These include demographics, socioeconomic group, psychographic profile, geographic region, behavioral style, and benefits. Let us take a closer look at how sports marketers use and choose from among these six bases for segmentation.

Bases for segmentation

The bases for segmentation refer to the ways that consumers with common needs can be grouped together. Six bases for segmenting consumer markets are shown in Table 6.1.

Demographic segmentation

One of the most widely used techniques for segmenting consumer markets is demographic segmentation. Demographics include such variables as age, gender, ethnic background, and family life cycle. As the accompanying article illustrates, sports fans may be segmented in a variety of ways.

Segmenting markets based on demographics is widespread for three reasons. First, these characteristics are easy for sports marketers to identify and measure. Second, information about the demographic characteristics of a market is readily available from a variety of sources, such as the government census data described in Chapter 3. Third, demographic variables are closely related to attitudes and sport behaviors, such as attending games, buying sports merchandise, or watching sports on television.

Table 6.1 Common bases for segmentation of consumer markets

Demographic	Geographic
• Age	• World region
• Gender	• Country
• Ethnic background	• Country region
• Family life cycle	• City
Socioeconomic	• Physical climate
• Income	Behavioral
• Education	• Frequency of purchase
• Occupation	• Size of purchase(s)
Psychographic	• Loyalty of consumers
• Lifestyle	Benefits
• Personality	• Consumer needs
• Activities	• Product features desired
• Interests
• Opinions

Age

Age is one of the most simplistic, yet effective demographic variables used to segment markets. Not only is age easy to measure, but it also is usually related to consumer needs. In addition, age of the consumer is commonly associated with other demographic characteristics, such as income, education, and stage of the family life cycle. A number of broad age segments exist such as the children’s market, the teen market, and the mature market. Care must be taken, however, not to stereotype consumers when using age segmentation. How many 10-year-olds do you know who think they are 20, and how many 75-year-olds think they are 45?

Web 6.1 A wide array of youth football programs exist that target participation in youth football and cheerleading.

Source: Reprinted with permission of Cleveland Browns Inc. (2014).

Children. There has always been a natural association between children and sports. However, sports marketers are no longer taking the huge children’s market for granted – and with good reason. Children have tremendous influence on purchasing decisions within the family and are increasingly purchasing more and more on their own.¹

Children, up to age 11, spend around $18 billion a year. Tweens, 8–12 year olds, ‘heavily influence’ more than $30 billion in other spending by parents, and 80 percent of all global brands now deploy a ‘tween strategy.’ As Dan Cook, Assistant Professor of Advertising and Sociology at the University of Illinois, noted in an article titled “Lunchbox Hegemony: Kids and the Marketplace, Then & Now,” kids not only want things, but have acquired the socially sanctioned right to want – a right which parents are loath to violate. Layered onto direct child enticement and the supposed autonomy of the child-consumer are the day-to-day circumstances of overworked parents: a daily barrage of requests, tricky financial negotiations, and that nagging, unspoken desire to build the lifestyle they have learned to want during their childhoods.²

Presently, many families spend at least $2,000 a year on sports-related expenses for their children.³ Children are participating in sports and are identifying with teams, players, and brands at younger ages each year. The 2012 Harris Poll YouthPulse study noted that young people have just as much money to spend as older adults.⁴ In fact, the purchasing power of 8–24 year old citizens in America is reaching $211 billion. Thus, sports marketers have recognized the power of the kids’ market. They realize children will become the fans and the season ticket holders of the future. As such, they have segmented markets accordingly.

Examples of sports marketers reaching the kids’ market are plentiful. For instance, Fisher-Price, the toy company, negotiated the rights to acquire a NASCAR license to produce battery-operated race cars for children. The mini-vehicles with engine sound effects feature two gears and achieve speeds of 2.5 or 5 mph, plus reverse, and sell for more than $200.

Build-a-Bear Workshops has collaborated with multiple Major League Baseball stadiums to find new customers, targeting the 12 and under market segment. Targeting this age group affords Build-a-Bear the opportunity for youth sports fans to build their own little team mascot.

In 1998, the NFL and the NFL Players Association formed the NFL Youth Football Fund (YFF), a 501(c)3 nonprofit foundation that supports the game at the youth level and promotes positive youth development. Through this fund, hundreds of thousands of children have been given the opportunity to learn about the game of football, get physically fit, and interact positively with adult mentors, all in a safe and accessible environment.

In 2005, the National Basketball Association launched an initiative offering its teams and players to further promote global community outreach. This initiative aimed to address important social issues such as education, youth and family development, and health and wellness, all through the use of various partners and programs. To date, the league, players, and teams have donated more than $210 million to charity, provided more than 2.3 million hours of hands-on service, and built more than 760 places where kids and families can live, learn, or play in communities worldwide.⁵ U.S. Fund for UNICEF President Caryl Stern recently complimented the NBA’s commitment to social responsibility, noting that their strategy has been philanthropic in a strategic way. He defined the NBA as utilizing a dedicated strategy at a number of different levels, noting that it was not just writing a check; it was a way to achieve and see results.⁶

In addition, the NHL’s Hockey is for Everyone initiative provides support to both ice and street hockey programs by teaching children how to learn, compete, and grow. The programs provide these unique hockey experiences to more than 300,000 children annually in over 30 non-profit hockey organizations and 1,600 schools and communities nationwide.

Photo 6.1 Professional sports are realizing the importance of the kids’ market to their long-term success.

Source: Shutterstock.com

The children’s segment is also growing in importance to those organizations marketing to kids via the Internet. For example, ToysRUs.com has introduced a new sporting goods site called SportsRUs.com with a “just for kids” area designed to help parents select sports equipment for kids ages five to 12. In another example, the President’s Council on Physical Fitness and Activity has launched a Web site (www.presidentschallenge.org) to help motivate kids and families become more physically active. The NFL also incorporates marketing geared toward children, with its own official NFL kids’ website, NFLRUSH.com. For example on the NFLRUSH.com site you will find the NFL’s Play 60 campaign. The campaign, tailored to make the next generation of youth the most active and healthy was launched in 2007. The program focused on increasing the health and wellness of youth fans by encouraging them to become active for at least 60 minutes a day.

Teens. Just as with the youth user segment, the number of teens is also expected to rise exponentially. According to the U.S. Census Bureau, by 2015, the population of children and teens between the ages of 10 and 19 will reach 41.42 million.⁷ With this potential amount of purchasing power it can be understood why sporting goods fall within the top 10 advertising categories for teens. One key to reaching this teen market is to involve them in the marketing process and engage them in the brand. What brands (or leagues, in this case) are hot with teens? Figure 6.1 shows the pro sports of interest to the teen market, including differences among males and females. Although teens represent a sizable and important market, sports marketers must better understand this group, or it will be lost. For instance, American teens are not tuning in to major sporting events in large numbers, at least not compared with the general population. None of the traditional championships attracts a television audience that is higher than 7.3 percent of teens ages 12–17. For the Daytona 500 and the World Series, only about one in 30 television viewers are teens. The one non-traditional championship that can claim a teenage viewing audience of 11.4 percent is the X Games, but even that finds the overwhelming majority of its viewers are from outside the teen ranks.⁸ Furthermore, these ratings are in spite of the fact that television viewing for teenagers is at an all time high. According to the Kaiser Foundation report, over the past five years there has been a huge increase of media use amoung young people. Teen’s lives today are primarily a story of technology facilitating increased consumption. Today’s multitasking teens pack 10 hours and 45 minutes worth of media content (multitasking) into a 7.38 hour day. These media frenzies occur 7½ hours a day, seven days a week.⁹

Figure 6.1 Pro-sports that appeal to teenagers: youth who say they are very or somewhat interested in the sport

Source: with permission of The Futures Company

What can sport marketers do to better reach teens? As the accompanying article illustrates, thinking “outside the norm” to grasp a further understanding of their usage pattens may be the answer.

The mature market. Another market that is expected to increase at a staggering pace is the age 55 and older, mature market. According to the 2012 U.S. Statistical Abstract, mature adults, age 55-plus in 2010 totaled 75 million.¹⁰ In fact, every day in America about 10,000 people turn 65 and by the year 2030, roughly one out of every five Americans will be aged 65 years and older.¹¹ These staggering numbers equal the entire populations of New York and California, Washington State, and the District of Columbia, or New York, California, and Massachusetts combined. Stereotypically, the elderly are perceived to be inactive and thrifty. Nothing could be further from the truth. The mature market is living longer and becoming more physically active. The country’s largest generation of 55-plus are joining health clubs at a rate of 34 percent per year.¹² The 50-plus age group controls over 70 percent of disposable income, holds $1.6 trillion in spending power, and a net worth that’s nearly twice the U.S. average. As a result, sports marketers are capitalizing on this growing market in a variety of ways.¹³

Traditionally, senior citizen discounts have been promoted in Major League Baseball. For example, the Milwaukee Brewers’ minor league affiliate, the Brevard County Manatees, created the 55+ fan club, providing tickets, merchandise, and other special promotional offers to seniors. Promotions such as private meet and greet with the players and coaches were designed to strengthen the relationship between the Manatees and the teams’ senior fans.¹⁴ Other examples of sports markets being segmented by age can be seen in the growing number of “senior” sporting tours and events. The Champions Tour of the PGA has nearly the following of the regular tour events. Although not as successful as the golf tour, other professional senior tours include tennis and bowling.

Seniors are also becoming more active as sports participants. The fastest-growing participation sports for seniors, classified as age 55 and older, include exercising to music and running or walking on the treadmill. Table 6.2 shows some of the most popular sports for the maturing baby boomer market.

The Golden Age Games is the largest veterans’ competition in the world open to those 55 and older. This Olympic-type event brings in more than 700 military veterans of the mature market, from 42 states as well as the U.S. Virgin Islands. Furthermore, the International Tennis Federation offers Seniors and Super-Seniors Individual and Team Championships held yearly in countries all over the world. The ITF Super-Senior World Team Championships, offering women’s age divisions (ages 60 to75) and men’s age divisions (ages 60 to 80), brings in 114 teams from 24 countries to compete.

Table 6.2 Most popular sports/athletic/fitness activities U.S. population, age 55+, based on total participation

Rank	Athletic Activity	Participants
1.	Fitness walking	10.3 million
2.	Treadmill exercise	8.8 million
3.	Stretching	8.2 million
4.	Hand weights	5.3 million
5.	Golf	4.9 million
6.	Freshwater fishing	4.6 million
7.	Day hiking	3.7 million
8.	Weight/resistance machines	3.6 million
9.	Stationary cycling (upright bike)	3.4 million
10.	Bowling	3.3 million
11.	Recreational vehicle camping	2.8 million
12.	Saltwater fishing	2.7 million
13.	Other exercise to music	2.6 million
14.	Dumbbells	2.5 million
15.	Stationary cycling (recumbent bike)	2.4 million

Source: Sports & Fitness Industry Association, www.sfia.org.

These examples of the senior athletes are representative of the mature market worldwide and demonstrate what a vibrant, independent, and viable segment this is for sport marketers.

Gender

A number of marketing executives in the sports industry have taken note that women have become crucial to their fan bases. Female fans have been so crucial that organizations such as the FIFA, the NFL, NASCAR, MLB, NBA, and NHL have focused promotional efforts toward enhancing the female audiences, with much success. For example, some 67 million women count themselves baseball fans – that’s just over half of baseball’s audience.¹⁵ In addition, 37 percent of basketball fans are women; and 44 percent of football fans are female. In fact, an estimated 43 million female viewers tuned in to the Super Bowl earlier this year, making it more popular than the Oscars. The NFL has realized the importance of women fans and is developing a strategic plan to attract them and keep them interested in a traditionally male-oriented sport. Based on research conducted by the NFL, women fans do not want to be treated differently than men. NFL Commissioner Roger Goodell stated, “(Women) fans want to be treated as real fans because they love the game, understand the game, and want to have the opportunity to experience the game just as anyone else does.”¹⁶

In 2010, ESPN also developed a strategic approach to targeting a growing female fan base, as the accompanying article indicates. Despite the obvious male overtones of the increasingly popular mixed martial arts scene – as exhibited by the success of the Ultimate Fighting Championship – fans of the female persuasion are also flocking to the newest sporting trend to hit the pay-per-view circuit. In fact, for a sport that used to be known as little more than a glorified bar brawl, mixed martial arts fights have been branded and stamped with a marketable seal of approval by sponsors and UFC stakeholders alike.

Ad 6.1 Hodgman is capitalizing on the growing mature market.

Source: Pure Fishing – Columbia

These widely publicized fights between experts in various martial arts are becoming a hit with women both in and out of the ring. Historically, sports enthusiasts have been male. However, stereotypes are eroding quickly as women are becoming more involved in every facet of sport. More women are participating in sports, and more women are watching sports. Moreover, every attempt is being made to make women’s sports equitable with their male counterparts as the promotion of the recent female championship broadcasts demonstrate.

One example of females participating in a historically male sport is football. Nationwide, 1,531 girls played on high school tackle football teams in the 2013 season, according to a survey by the National Federation of State High School Associations.¹⁷ Some 90 professional women’s football teams in three main leagues exist across the country. The three leagues all play the same game, with minor deviations from NFL rules, but they approach the business in very different ways. A NSGA poll tracking sports participation noted that 12.1 percent of females participate in football and 21.4 percent in baseball, both male-dominated sports.¹⁸

Ethnic background

Segmenting markets by ethnic background is based on grouping consumers of a common race, religion, and nationality. Ethnic groups, such as African Americans (12.9 percent of the U.S. population), Hispanic Americans (15 percent of the U.S. population), and Asian Americans (4 percent of the U.S. population)¹⁹ are increasingly important to sports marketers as their numbers continue to grow. When segmenting based on ethnic background, marketers must be careful not to think of stereotypical profiles but to understand the unique consumption behaviors of each group through marketing research.

Major League Soccer (MLS) has long espoused the philosophy of having an ethnic fan base. Commissioner Don Garber believes the MLS is “perfectly suited to capitalize on what’s going on in this country. We are a nation of increasing ethnic diversity. We are a nation that’s finding itself in an increasingly growing global community. And that global community is linked by one language, a language that is shared by all, and that’s the sport of soccer.” Garber has also helped league officials and marketing folks understand that there are increasing numbers of immigrants – particularly in Hispanic communities – to whom soccer is a cultural necessity. Garber said, “Capturing the ethnic fan” is essential in making that approach work. “It requires careful considerations. It means realizing that fans bang drums and stand throughout the game. It means courting Spanish-language media, Caribbean media, and other foreign-language interests.”²⁰ As the accompanying article articulates, understanding any subculture goes well beyond the language.

The NBA has also strengthened international marketing efforts. Under the umbrella program NBA Cares, the National Basketball Association has developed an initiative to reach globally to the Latin American youth population. Basketball Without Borders developed programs including building youth centers and hosting clinics in Brazil, Argentina, and Puerto Rico.

Another example of marketing to ethnic groups includes the introduction of Deportes Hoy, the premier Spanish-language sports daily. The sports information product will be circulated in Los Angeles, Orange, and San Diego counties (California) and will be targeted to reach everyone from the occasional to the most highly involved sports enthusiasts.²¹ ESPN began to publish a monthly Spanish-language edition of ESPN The Magazine beginning in 2007 and a Spanish-language version of ESPN.com, demonstrating their ongoing commitment to Hispanic sports fans in the United States. Similarly, many MLB teams are also establishing Spanish-language websites corresponding with the main English site.

The Hispanic market is not the only ethnic segment of interest to sport marketers. In the United States, Asian Americans have the highest median household income of any ethnic group of $70,221, which is nearly 14.7 percent higher than that of non-Hispanic whites. With a 116 percent increase in purchasing power over the past decade, Asian Americans are the fastest growing, most educated, and a highly reachable segment in the country. Moreover, they are the nation’s fastest growing ethnic group, with large population centers in major cities that are home to multiple pro sports franchises. When it comes to putting fans in the stands and merchandise in their homes and offices, Asian Americans should be a sports marketer’s dream.²² Whether it’s the Hispanic market, Asian market, or any other ethnic market, sport organizations are realizing the critical nature of understanding and catering to these growing segments for all sports products and services.

Family life cycle

The family life cycle was a concept developed in the 1960s to describe how individuals progress through various “life stages,” or phases of their life. A traditional life cycle begins with an individual starting in the young, single “life stage.” Next, an individual would progress through stages such as young, married with no children; young, married with children; to, finally, older with no spouse. As you can see, the traditional stages of the family life cycle are based on demographic characteristics such as age, marital status, and the presence or absence of children.

Today, the traditional family life cycle is no longer relevant. In 2013, 3.6 per 1,000 people in the United States are divorced, compared with 6.8 per 1,000 people who are married, and the number of single-parent households is on the rise.²³ Changes in family structure such as these have led marketers to a more modern view of the family life cycle, shown in Figure 6.2.

Figure 6.2 Modern family life cycle

Sports marketers segmenting on the basis of family life cycle have a number of options. Do they want to appeal to the young and single, the elderly couple with no kids living at home, or the family with young children? Sports that are growing in popularity, such as biking, segment markets based on a stage of the family life cycle. Just imagine the incompatible biking needs of a young, single person versus a young, married couple with children.

Professional sports have come under increased scrutiny in the past decade for their lack of family values. Rising ticket prices, drunken fans, and late games have all been cited as examples of professional sports becoming “family unfriendly.” Realizing this, sports marketers have tried to renew family interest in sports and make going to the game “fun for the entire family.”

There are numerous examples of sports marketers trying to become more family friendly. For instance, the addition of Homer’s Landing, an area where families can picnic before, during, and after the game, has become a “hit” for the St. Louis Cardinals. The Chicago Cubs and other professional teams have initiated no-alcohol sections at their games to encourage a family environment. The NFL is taking an initiative to give professional football a G-rated family-friendly atmosphere, limiting the service of alcohol and setting up text-messaging systems for fans to report unruly behavior. The hope is for a raise in the standard of fan behavior on game days, making the environment more appropriate for families. Moreover, many sports organizations have instituted family nights, which include tickets, parking, and food for a reduced price to encourage family attendance.

Ad 6.2 Pygmy is segmentation on the basis of the family life cycle.

Source: www.pygmyboats.com

Socioeconomic segmentation

Thus far, we have discussed demographic variables such as age, gender, ethnic background, and family life cycle as potential ways to segment sports markets. Another way of segmenting markets that was found to be a good predictor of consumer behavior is through socioeconomic segmentation. As previously defined, social class is a division of members of a society into a hierarchy of distinct status classes, so that members of each class have relatively the same status and members of all other classes have either more or less status.

Although most people immediately equate social class with income, income alone can be a poor predictor of social class. Other factors such as educational level and occupation also determine social standing. Usually, income, education, and occupation are highly interrelated. In other words, individuals with higher levels of education typically have higher income and more prestigious occupations. Based on these factors (income, education, and occupation), members of a society are artificially said to belong to one of the social class categories. The traditional social class categories are upper-, middle-, and lower-class Americans. Participation in certain sports has been associated with the various social strata. For instance, golf and tennis are called “country club” sports. Polo is a sport of the “rich and famous.” Bowling is usually thought of as the “blue-collar” sport of the working class.

As with sex roles, the relationship between social class and sport is now shifting. Golf is now being enjoyed by people of all income levels and sports like mixed martial arts continue to attract both blue- and white-collar populations. While there appears to be valid evidence to support the notion that sport participation is related to social class, studies of sport have found that the higher one’s social class, the greater one’s involvement in sports.²⁴ Many believe that sport and entertainment are perfectly suited to capitalize on the social qualities of a “New America.” In an era where the Internet is eliminating physical and cultural boundaries and creating a larger global community, sport provides a platform to augment these “pastime” exchanges. Although these exchanges are often still tied to economic factors, i.e., what one can afford, sport serves as an escalator that provides opportunity.

Photo 6.2 Polo is a sport that has typically appealed to the upper class.

Source: Shutterstock.com

Attending a professional basketball or hockey game, once affordable for the whole family, is now a more costly endeavor, therefore today’s consumers tend to weigh the pros and cons of attending against the array of entertainment alternatives, i.e. media and other forms of entertainment. Some choose to spend the money, others not, but, the opportunity for exchange still exists. In addition, as the roles of social class continue to shift so do value exchange components that affect their purchasing decisions. For in many instances season tickets options to these events, which used to be readily affordable, can only be enjoyed by wealthy corporate season ticket holders today.

Traditionally, NASCAR fans are stereotypically “good ol’ boys” with “blue-collar” values. However, NASCAR has turned into a multibillion-dollar-a-year industry and a marketing success story. During this tremendous growth, the sport is moving beyond its “good-ol’-boy” mentality and reaching a new market in yuppie America. Just consider the demographics of the NASCAR fan. Approximately 42 percent of NASCAR fans earn $50,000 or more per year, compared with 39 percent of the entire U.S. population. At the other end of the wage scale, 39 percent of the U.S. population earns under $30,000, compared with 29 percent of NASCAR fans.²⁵

Psychographic segmentation

Psychographic segmentation is described as grouping consumers on the basis of a common lifestyle preference and personality. Because personality alone is very difficult to measure and has not been linked to sports behavior, few sports marketing practitioners find it useful alone. The results of one recent study suggest that individuals who are most likely to identify with a team are those who are most likely to seek out and enjoy social exchanges. The researchers suggest that marketing plans should be designed to emphasize communal aspects of events and that individuals rated high on extraversion, agreeability, and materialism may be more responsive to such promotions. Psychographics, however, looks more toward lifestyle preferences and less toward specific personality measures.

Psychographic segments are believed to be more comprehensive than other types of segmentation, such as demographics, behavioral, or geodemographic. As consumer behavior researcher Michael Solomon points out, “Demographics allow us to describe who buys, but psychographics allows us to understand why they do.”²⁶ For this reason, many sports marketers have chosen to segment their markets on the basis of psychographics. To gain a better understanding of consumers’ lifestyles, marketers assess consumers’ AIO dimensions, or statements describing activities, interests, and opinions (AIO). The three AIO dimensions are shown in Table 6.3.

Typically marketers quantify AIOs by asking consumers to agree or disagree with a series of statements reflecting their lifestyle. These statements can range from measures of general interest in sports to measures focusing on a specific sport. As seen in Table 6.3, many of these AIO dimensions relate indirectly or directly to sports. For example, sports, social events, recreation, and products may have a direct link to sports, whereas club memberships, fashion, community, and economics may be indirectly linked.

An example of psychographic segmentation in the fresh water fishing market can be seen in Table 6.4. This table illustrates a fisherman’s lifestyle based on research from SRDS: The Lifestyle Market Analyst/National Demographic and Lifestyle. This type of information examines activities and interests of fishermen to determine what products and services might be successfully marketed to this group. For example, many professional fresh water fishing tournaments are sponsored by investment companies to capitalize on this popular activity of fishing.

Table 6.3 AIO dimensions

Activities	Interests	Opinions
Work	Family	Themselves
Hobbies	Home	Social issues
Social events	Job	Politics
Vacation	Community	Business
Entertainment	Recreation	Economics
Club membership	Fashion	Education
Community	Food	Products
Shopping	Media	Future
Sports	Achievements	Culture

Source: Journal of Advertising Research

Marketers can also segment and target consumers by combining their lifestyles, obtained through AIOs, with their values. This method is called VALS, which is an acronym for values and lifestyles.²⁷ Values are “desirable, trans-situational goals, varying in importance, that serve as guiding principles in people’s lives.” The VALS model places consumers into one of eight segments based on their values. These segments range from innovators at the top to survivors at the bottom. Consumers are further segmented based on their affinity for ideals, achievement, and self-expression. For example, a consumer categorized as an innovator who values achievement would be motivated to seek products and services that convey status and success to others. Knowing this, marketers are able to tailor strategies that reach these types of consumers and impact them accordingly. Some researchers consider the VALS method to be “more elegant and fundamental” than the AIO approach.

Table 6.4 Lifestyle Analysis Report: Lifestyle Ranking Index

Sports & Leisure: Go Fresh Water Fishing, 1yr (A)
Lifestyle Category: Psychographics
Lifestyle Title	Count	Users / 100 HHs	Index
Try to Buy Goods Produced by Own Country, Agr (A)	37,764,670	100.40	108
Like Spending Most Time Home with Family, Agr (A)	49,590,631	131.84	107
Advertising to Kids Is Wrong, Agr (A)	33,121,346	88.05	106
How I Spend Time Is More Important than Money, Agr (A)	44,704,816	118.85	105
Consider Myself a Spiritual Person, Agr (A)	42,487,608	112.95	105
My Faith is Really Important to Me, Agr (A)	43,215,029	114.89	105
Only Go Shopping to Buy Something I Really Need, Agr (A)	49,278,623	131.01	105
Always Look for Special Offers, Agr (A)	44,640,336	118.68	105
Rely on TV To Keep Me Informed, Agr (A)	37,577,721	99.90	105
Have a Keen Sense of Adventure, Agr (A)	34,670,003	92.17	105
Rely on Radio to Keep Me Informed, Agr (A)	20,406,883	54.25	104
Typically Avoid Watching TV Commercials, Agr (A)	35,607,315	94.66	104
Consider Myself a Creative Person, Agr (A)	45,697,334	121.49	104
Do Some Sport/Exercise Once a Week, Agr (A)	39,187,986	104.18	103
Rely on Newspaper to Keep Me Informed, Agr (A)	25,910,852	68.89	103
Prefer Specialty Store because Employee Knowledge, Agr (A)	25,746,422	68.45	101
People Have a Duty to Recycle, Agr (A)	41,615,117	110.64	101
Always Look for Brand Name, Agr (A)	25,135,001	66.82	101
Prefer to Buy Products from Specialty Stores, Agr (A)	19,425,898	51.64	100
Prefer Specialty Stores because Have Best Brands, Agr (A)	15,450,159	41.08	100
Listen Less to Non-Internet Radio because of Internet, Agr (A)	8,665,177	23.04	99
Ban Products that Pollute, Agr (A)	25,398,600	67.52	99
Would Pay More for Environmentally Friendly Products, Agr (A)	24,595,905	65.39	99
Rely On Magazines to Keep Me Informed, Agr (A)	9,967,361	26.50	99
Interested in The Arts, Agr (A)	28,021,405	74.50	99
Like to Stand Out in a Crowd, Agr (A)	15,827,240	42.08	97

Source: PRIZM 2010, Experian Marketing Solutions, Inc, 2010.

Geographic segmentation

Geographics is a simple, but powerful, segmentation basis. Certainly, this is critical for sports marketers and as long-standing as “rooting for the home team.” All sports teams use geographic segmentation; however, it is not always as straightforward as it may initially seem. For instance, the Dallas Cowboys, Chicago Bulls, Atlanta Braves, and the Fighting Irish are all known as “America’s Team.”

Geographic segmentation can be useful in making broad distinctions among local, regional, national, and international market segments. International or multinational marketing is a topic of growing interest for sports marketers. For example, Major League Baseball has held regular-season games in Japan, Mexico, and Puerto Rico, and the NBA games are televised in 215 countries in 47 languages.²⁸ The NFL has also expanded internationally and now broadcasts games in 234 countries and territories in 31 languages.²⁹ As the Spotlight on International Sports Marketing indicates, the leagues are realizing that the key to growth is going global.

The physical climate also plays a role in segmenting markets geographically. Classic examples include greater demand for snow skiing equipment in Colorado and surfboards in Florida. However, Colorado ski resorts have the greatest number of sports tourists who come from Florida, hardly thought of as a snow ski mecca. Therefore, segments of sports consumers may exist in unlikely geographic markets. In this example, the psychographics of the sports consumer may be more important in predicting behavior than geographic location.

Although the climate plays an important role in sports, marketers have attempted to tame this uncontrollable factor. For instance, tons of sand was shipped to Atlanta, creating beach-like conditions, for the first ever Olympic beach volleyball competition. The creation of domed stadiums has also allowed sports marketers to tout the perfect conditions in which fans can watch football in the middle of a blizzard in Minnesota or during the middle of a thunderstorm in Houston, Texas.

Behavioral segmentation

For sports marketers engaged in the strategic sports marketing process, two common goals are attracting more fans and keeping them. Behavioral segmentation lies at the heart of these two objectives. Behavioral segmentation groups consumers based on how much they purchase, how often they purchase, and how loyal they are to a product or service.

Interestingly, in today’s professional sports environment, loyalty is an increasingly important topic. Many professional sports teams have held their fans and cities hostage, and cities are doing everything they can to keep their beloved teams. Taxpayers nationwide have paid more than $14 billion for stadiums and arenas during the past 20 years. This new construction and renovation was done largely to keep team owners satisfied and curb any threat of moving. For 2012–2013, the value of major league arenas and stadiums opening was over $10 billion. Add collegiate and minor league facility construction, and the number increased beyond $19 billion.³⁰

Franchises and players within each team move so rapidly that fan loyalty becomes a difficult phenomenon to capture. The day of the lifelong fan is over. Because of this, fans may identify more with individual players or even coaches (e.g., Derek Jeter and the Yankees, Kobe Bryant and the Lakers, or Frank Beamer and Virginia Tech Football) than they do with teams. According to some sports marketing experts, next to wins, fans like to see famous faces on the field.³¹ This is true even in team-dominated sports, such as football.

Fans may be more concerned with the individual performance of Albert Pujols than they are with the St. Louis Cardinals. Certainly, sports marketers have to monitor this trend of diminishing loyalty to a team. However, some sports fans show extreme loyalty by purchasing personal seat licenses (PSLs). PSLs require fans to pay a leasing fee for their seats. This fee would guarantee the consumer his or her seat for several years. The PSL, of course, demonstrates the extreme devotion of a group of fans. For example, NFL fans in Dallas had to pay PSLs of up to $150,000 just for the right to purchase season tickets at the new Cowboys Stadium.

Sports marketers have recently taken a lesson in loyalty marketing from other industries and are creating loyalty marketing programs. A study by Pritchard and Negro³² found that these programs are effective when they build on the genuine affinity fans have for their teams, rather than rewarding attendance alone. Increasing fan interaction with players, coaches, and the entire organization through direct access or personal communication was shown to be much more important to the success of loyalty programs than rewarding attendance.

Along with behavioral segmentation based on loyalty to a team or sports product, consumers are frequently grouped on the basis of other attendance or purchasing behaviors. For instance, lifelong season ticket holders represent one end of the usage continuum, whereas those who have never attended sporting events represent the other end. A unique marketing mix must be designed to appeal to each of these two groups of consumers.

Benefits segmentation

The focus of benefits segmentation is the appeal of a product or service to a group of consumers. Stated differently, benefits segments describe why consumers purchase a product or service or what problem the product solves for the consumer. In a sense, benefits segmentation is the underlying factor in all types of marketing segmentation in that every purchase is made to satisfy a need. Benefits segmentation is also consistent with the marketing concept (discussed in Chapter 1) that states that organizations strive to meet customers’ needs.

Major shoe manufacturers, such as Nike, focus on “benefits sought” to segment markets. In fact, Nike’s mission is to bring inspiration and innovation to every athlete in the world. This includes both the elite athletes and professional performers as well as the casual performer. Some consumers desire a high-performance cross-training shoe, whereas others want a shoe that is more of a fashion statement. Nike is a fashion brand. Consumers that wear Nike products do not always buy it to participate in sport. Nike produces sportswear products from manufacturing waste therefore enhancing the development opportunities that satisfy a consumer market, i.e. sunglasses and jewelry. Nike focuses on personal benefit associated with the use of its products and the values satisfied by this product use.³³

Golf ball manufacturers also try to design products that will appeal to the specific benefits sought by different groups of golfers. Pro V1 has enhanced aerodynamics with slightly higher flight for longer distance, soft feel, and Drop-And-Stop control. DT SoLo gives the ultimate combination of distance with soft feel and guaranteed cut-proof durability. NXT Tour has long distance off the driver and improved control with long irons. The Titleist DT Spin offers a combination of long tee-to-green distance, wound-ball spin, improved feel, and guaranteed cut-proof durability, whereas the Titleist DT Distance offers golfers longer and straighter two-piece distance with cut-proof durability. Sports marketers really hit a home run when they design products that satisfy multiple needs (i.e., distance, feel, accuracy, durability) of consumers.

Choosing more than one segment

Although each of the previously mentioned bases for segmentation identifies groups of consumers with similar needs, it is common practice to combine segmentation variables. An example of combining segmentation approaches is found in a study of the golf participant market.³⁴ A survey was conducted to determine playing ability, purchase behavior, and the demographic characteristics of public and private course golfers. The resulting profile produced five distinct market segments that combine some of the various bases for segmentation discussed earlier in the chapter. These five segments are shown in Table 6.5.

Table 6.5 Five market segments for golf participants

Competitors (18.6 percent) •  Have a handicap of less than 10 •  Indicate love of game •  Play for competitive edge •  Practice most often •  Most likely to play in league •  Own most golf clothing •  Are early adopters (e.g., third wedge) •  Buy most golf balls Players (25.7 percent) •  Have handicap between 10 and 14 •  Use custom club makers •  Practice a lot •  Like competition •  Exercise and companionship are important •  Most likely to take out-of-state golf vacation Sociables (17.8 percent) •  Have handicap between 15 and 18 •  Often play with family •  Purchase from off-price retailers •  Play for sociability •  Most likely to take winter vacation to warm destination Aspirers (18.4 percent) •  Have handicap between 19 and 25 •  Love to play; hate to practice •  Most inclined to use golf for business purposes •  Golf shows are important as source of information •  Competition and sociability are unimportant reason to play Casual (19.5 percent) •  Have handicap of 26 or more •  Do not practice •  More women in this segment •  Play less frequently than other segments •  Own the least golf clothing •  Purchase the fewest golf balls •  Recreation is most important factor for play •  Exercise and companionship are moderately important •  Least likely to take a golf vacation •  Most likely to shop in course pro shop

Source: Sam Fullerton and H. Robert Dodge, “An Application of Market Segmentation in a Sports Marketing Arena: We All Can’t Be Greg Norman,” Sport Marketing Quarterly, vol. 4, no. 3 (1995), 43–47.

Geodemographic segmentation

One of the most widely used multiple segment approaches in sports is geodemographic segmentation. Although geographic segmentation and demographic segmentation are useful tools for sports marketers, combining geographic and demographic characteristics seems to be even more effective in certain situations. For instance, many direct marketing campaigns apply the principles of geodemographic segmentation.

The basis for geodemographic segmentation is that people living in close proximity are also likely to share the same lifestyle and demographic composition. Because lifestyle of the consumer is included in this type of segmentation, it is also known as geolifestyle. Geodemographics allows marketers to describe the characteristics of broad segments such as standard metropolitan statistical areas (SMSAs) all the way down to census blocks (consisting of roughly 340 houses). The most common unit of segmentation for geodemography is the zip code. Claritias, Inc., a marketing firm leading the charge in geodemographics, established the PRIZM system in the 1970s. PRIZM is used to identify potential markets for products. PRIZM affords marketers the benefits of household-level precision in applications such as direct mail, while at the same time maintaining the broad market linkages, usability, and cost-effectiveness of geodemographics for applications such as market sizing and site selection.³⁵ Each unit of geography was originally classified as one of 62 PRIZM clusters. However, PRIZM NE (New Evolution) released in 2004, replaced the original PRIZM system (now referred to as PRIZM 62). PRISM NE utilizes one of 66 PRIZM clusters, which have been given names that best characterize those populations. Some examples of the PRIZM 62 cluster categories are shown in Table 6.6.

Target markets

After segmenting the market based on one or a combination of the variables discussed in the previous section, target markets are chosen. Target marketing is choosing the segment(s) that will allow an organization to most efficiently and effectively attain its marketing goals.

Table 6.6 PRIZM cluster categories and descriptions

Uppper Crust – Ranked number 1 of all 66 clusters, the upper class segment includes those who are older and wealthier without children. This group is 55 or older and takes on more management roles in the workforce. This neighborhood would be filled with more prestigious individuals who would drive cars such as Lexus LS. God’s Country – Populated by educated, upscale professionals, married executives who choose to raise their children in the far exurbs of major metropolitan areas. Their affluence is often supported by dual incomes. Lifestyles are family and outdoor centered. Bohemian Mix – Describes most of our nation’s college towns and university campus neighborhoods. With a typical mix of half locals (towns) and half students (gowns), it is totally unique. Thousands of penniless 18- to 24-year-old kids, plus highly educated professionals with a taste for prestige products beyond their means. Winner’s Circle – Sixth in American affluence and typified by new money, living in expensive new mansions in the suburbs of the nation’s major metros. These are well-educated, mobile executives and professionals with teen-age families. Big producers, prolific spenders, and global travelers.

Source: How to Use PRIZM (Alexandria, VA: Claritas, 1996).

Sports marketers must make a systematic decision when choosing groups of consumers they want to target. To make these decisions, each potential target market is evaluated on the basis of whether it is sizable, reachable, and measurable, and whether it exhibits behavioral variation. Let us look at how to judge the worth of potential target markets in greater detail.

Evaluation of target markets

Sizable

One of the first factors to consider when evaluating and choosing a potential target market is the size of the market. In addition to the current size of the market, sports marketers must also analyze the estimated growth of the market. The market growth would be predicted, in part, through environmental scanning, already discussed in Chapter 2.

Sports marketers must be careful to choose a target market that has neither too many nor too few consumers. If the target market becomes too large, then it essentially becomes a mass, or undifferentiated, market. For example, we would not want to choose all basketball fans as a target market because of the huge variations in social class, lifestyles, and consumption behaviors.

However, sports marketers must guard against a target market that is too small and narrowly defined. We would not choose a target market that consisted of all left-handed female basketball fans between the ages of 30 and 33 who live in San Antonio and have income levels between $40,000 and $50,000. This market is too narrowly defined and would not prove to be a good return on our marketing investment.

One common trap that marketers fall into with respect to the size of the potential market is known as the majority fallacy. The majority fallacy assumes that the largest group of consumers should always be selected as the target market. Although in some instances the biggest market may be the best choice, usually the competition is the fiercest for this group of consumers; therefore, smaller and more differentiated targets should be chosen.

These smaller, distinct groups of core customers that an organization focuses on are sometimes referred to as a market niche. Niche marketing is the process of carving out a relatively tiny part of a market that has a very special need not currently being filled. By definition, a market niche is initially much smaller than a segment and consists of a very homogeneous group of consumers, as reflected by their unique need. The differences between market segments and niches are highlighted in Table 6.7. Hanas (2007) provides support for the use of niche marketing in the sports industry, emphasizing that niche sport properties should be aware of their influence on several different communities. Properties need to be aware of their image, be cognizant of the image potential, and how their image may be attractive to potential sport properties. Focusing on the image intricacies, niche marketing may enable sport properties to enhance the linkage between the wants and needs of the consumer with sponsors and sponsees. For these reasons niche sport properties need to know how to best reach and connect with the different communities. Niche sport marketers should have a thorough grasp on each of these communities and what each of those communities looks like from a demographic and psychographic perspective. Organizations and sports such as professional bull riders, paintball leagues, hunting, even professional gamblers and eaters have always been present but have increased in status and popularity with fans as well as sponsors over recent years.

Table 6.7 Market segment vs. market niches

Segment	Niche
Small mass market	Very small market
Less specialized	Very specific needs
Top down (go from large market into smaller pieces)	Bottom up (cater to the smaller pieces of the market)

These niche leagues and sports have the ability to reach a small target audience and have been seen to be more aggressive in collaborating with marketers. By providing alternative platforms to marketers, they have multiplied the sponsorship opportunities.³⁶

One specific example of a niche market is individuals (as opposed to corporations) who have financially invested in the sports franchise through the purchase of season tickets for many seasons. In addition to their financial investment, these loyal fans have a high emotional investment in the team. To retain these valuable consumers, sports marketers must develop a specialized marketing mix to reinforce and reward the loyalty that these fans have shown to the organization.

Reachable

In addition to exploring the size of the potential target market, its ability to be reached should also be evaluated. Reach refers to the accessibility of the target market. Does the sports marketer have a means of communicating with the desired target market? If the answer to this question is no, then the potential target market should not be pursued.

Traditional means of reaching the sports fan include mass media, such as magazines, newspapers, and television. In today’s marketing environment it is possible to reach a specific target market with technology such as the Internet, specifically through social media. According to Sports Fan Graph, professional sports have recently been utilizing this avenue to promote leagues, teams, and athletes through Facebook. The NBA has over 24 million fans “likes” on Facebook, MLB 5.4 million “likes” while the NFL has over 10.5 million fan “likes”. In fact when looking at the NFL, and including all 32 teams, almost 1 in 10 Americans have declared their support for an NFL team on Facebook³⁷ In addition to the Internet, satellite technology products, such as DIRECTV, are allowing sports fans across the United States access to their favorite teams. This, of course, opens new geographic segments for sports marketers to consider.

Web 6.2 Reaching women’s soccer fans on the Web

Source: ESPN.com

Measurable

The ability to measure the size, accessibility, and purchasing power of the potential target market(s) is another factor that needs to be considered. For a market segment to represent a good target market, sport marketers must be able to identify and then measure the number of people in that segment. If a sport marketer has no measurable criteria to identify the size or scope of that market segment, a marketer may want to reconsider basing a marketing campaign on that segment. Segments may be composed of multiple criteria; however, for segments to be measurable they should be evaluated against the following criteria:

  Identifiable – Differentiation among attribute measures must occur so they can be identified.

  Accessible – Market segments must be reachable through communication and distribution channels.

  Sustainable – Market segments should be sufficiently large to justify the resources required to target them.

  Unique needs – Clarify considerations and offerings as they relate to the needs of the consumer.

  Durable – Segments should be measured to identify stability and to minimize cost and the frequency of change.

One of the reasons demographic segmentation is so widespread is the ease with which characteristics such as age, gender, income level, and occupation can be assessed or measured. Psychographic segments are perhaps the most difficult to measure because of the complex interaction of personality and lifestyle.

Behavioral variation

Finally, if the target market is sizable, reachable, and measurable, sports marketers must examine behavioral variation. We want consumers within the target market to exhibit similar behaviors, attitudes, lifestyles, and so on. In addition, marketers want these characteristics to be unique within a target market. This component is the underlying factor in choosing any target market.

An example of behavioral variation among market segments is the corporate season ticket holder versus the individual season ticket holder. Although both corporate season ticket holders and individual season ticket holders may be fans at some level, their motivation for attending games and attitudes toward the team may be quite different. These variations would prompt different approaches to marketing to each segment.

How many target markets?

Now that we have evaluated potential target markets, do we have to choose just one? The answer depends largely on the organization’s marketing objectives and its resources. lf the firm has the financial and other resources to pursue more than one target market, it does so by prioritizing the potential target markets.

The market distinguished as the most critical to attaining the firm’s objectives is deemed the primary target market. Other, less critical markets of interest are called secondary, tertiary, and so on. Again, a unique marketing mix may need to be developed for each target market, so the costs associated with choosing multiple targets are sometimes prohibitive.

Positioning

Segmentation has been considered and specific target markets have been chosen. Next, sport marketers must decide on the positioning of their sporting events, athletes, teams, and so on. Positioning is defined as fixing your sports entity in the minds of consumers in the target market.

Before discussing positioning, three important points should be stressed. First, positioning is dependent on the target market(s) identified in the previous phase of the market selection decisions. In fact, the same sport may be positioned differently to distinct target markets. As the spotlight demonstrated earlier in the chapter, the positioning of the NBA and other professional sports is changing with the opening of a new target market – women.

Second, positioning is based solely on the perceptions of the target market and how its members think and feel about the sports entity. Sometimes positioning is mistakenly linked with where the product appears on the retailer’s shelf or where the product is placed in an advertisement. Nothing could be further from the truth. Position is all about how the consumer perceives your sports product relative to competitive offerings.

Third, the definition of positioning reflects its importance to all sports products. It should also be noted that sports leagues (Arena Football versus NFL), sports teams (e.g., Dallas Cowboys as “America’s Team”), and individual athletes (e.g., Danica Patrick as a female athlete in a male-dominated sport, or the NFL’s perennial bad boy, Michael Vick) all must be positioned by sports marketers.

How does the sports marketer attempt to fix the sports entity in the minds of consumers? The first step rests in understanding the target market’s perception of the relevant attributes of the sports entity. The relevant attributes are those features and characteristics desired in the sports entity by the target market. These attributes may be intangible, such as a fun atmosphere at the stadium, or tangible, such as having cushioned seating. Golf manufacturers such as Slazenger have positioned their equipment as the “standard of excellence” and having “impeccable quality.”

In another example, consider the possible product attributes for in-line skates. Pricing, status of the brand name, durability, quality of the wheels, and weight of the skate may all be considered product attributes. If serious, competitive skaters are chosen as the primary target market, then the in-line skates may be positioned on the basis of quality of the wheels and weight of the skate. However, if first-time, recreational skaters are considered the primary target market, then relevant product attributes may be price and durability. Marketers attempt to understand all the potential attributes and then which ones are most important to their target markets through marketing research.

Perceptual maps

Perceptual mapping is one of the few marketing research techniques that provides direct input into the strategic marketing planning process. It allows marketing planners to assess the strengths and weaknesses and to view the customer and the competitor simultaneously in the same realm. Perceptual mapping and preference mapping techniques have been a basic tool of the applied marketing research profession for over 20 years. It is one of the few advanced multivariate techniques that has not suffered very much from alternating waves of popularity and disfavor.³⁸

Ad 6.3 47 Brand positions itself as the official licensee of the National Basketball Association.

Source: Forty Seven Brand

Figure 6.3 One-dimensional perceptual map of sports

Perceptual maps provide marketers with three types of information. First, perceptual maps indicate the dimensions or attributes that consumers use when thinking about a sports product or service. Second, perceptual maps tell sports marketers where different sports products or services are located on those dimensions. The third type of information provided by perceptual maps is how your product is perceived relative to the competition.

Perceptual maps can be constructed in any number of dimensions, based on the number of product attributes being considered. Figure 6.3 demonstrates a one-dimensional perceptual map, which explores the positioning of various spectator sports based on the level of perceived aggression or violence associated with the sports. This hypothetical example can be interpreted as follows: Boxing is seen as the most violent or aggressive sport, followed by football, hockey, and soccer. However, golf is the least aggressive sport. These results would vary, of course, based on who participated in the research, how aggression or violence is defined by the researchers, and what level of competition is being considered (i.e., professional, high school, or youth leagues).

Although it is easy to conceptualize one-dimensional perceptual maps, the number of dimensions is contingent upon the number of attributes relevant to consumers. For example, Converse positions its shoes for multiple uses like action sports, basketball, cheerleading, cross-training or fashion. New Balance, however, positions its shoes solely on the basis of running.

A study using perceptual mapping techniques found that consumers identify six dimensions of sport (shown in Table 6.8). Although it is possible to create a six-dimensional perceptual map, it is nearly impossible to interpret. Therefore, two-dimensional perceptual maps were constructed that compared 10 sports on the six dimensions identified by consumers.

Figure 6.4 shows a two-dimensional perceptual map using Dimension 4 (skill developed primarily with others versus skill developed alone) and Dimension 5 (younger athletes versus broad age ranges of participants). Interpreting this perceptual map, we see that football is considered a sport whose participants are younger athletes and skill is developed primarily with others. Compared with football, golf is seen as a sport for a broader range of participants with skills developed more on your own. Using these results, sports marketers can better understand the image of their sport from the perspective of various target markets and decide whether this image needs to be changed or maintained.

Table 6.8 Six dimensions or attributes of sports

Dimension 1	Strength, speed, and endurance vs. methodical and precise movements
Dimension 2	Athletes only as participants vs. athletes plus recreational participants
Dimension 3	Skill emphasis on impact with object vs. skill emphasis on body movement
Dimension 4	Skill development and practice primarily alone vs. primarily with others
Dimension 5	A younger participant in the sport vs. participant ages from young to older
Dimension 6	Less masculine vs. more masculine

Source: James H. Martin, “Using a Perceptual Map of the Consumer’s Sport Schema to Help Make Sponsorship Decisions,” Sport Marketing Quarterly, vol. 3, no. 3 (1994), 27–33.

Figure 6.4 Two-dimensional perceptual map of sports

Repositioning

As suggested, sport marketers may use the results of positioning studies to change the image of their sport. For instance, professional cycling, one of the most popular sports in the world, has been marred by doping scandals in recent years. Cycling took a big hit when the “Operation Puerto” case alleged that a number of riders had accepted illegal doping substances, and that scandal was followed by the Tour de France, which was tainted by the revelation that U.S. rider and Tour winner Floyd Landis had failed both of his drug tests. Obviously this is not the image the cycling federations and the cyclists themselves wish to project. Thus, the sport of cycling was trying to reposition itself or change the image or perception of the sports entity in the minds of consumers in the target market.

In response to those drug allegations, and in hopes of cleaning up the reputation of the sport, Team Slipstream took a pro-active response. Team Slipstream, now Garmin-Sharp Pro Cycling Team, is a professional cycling team based in the United States, consisting of 29 riders who have subjected themselves to weekly drug testing, instead of just waiting until race day to be tested.³⁹ “It’s ensuring [to] the public, the fans, and ourselves that our riders are clean,” said team director Jonathan Vaughters, who retired from competitive racing in 2003. “It’s enormously important as far as sponsors go to know that their team is not getting caught up in a scandal, and it’s setting an example for young athletes.”⁴⁰ Unfortunately, during this “repositioning phase” a larger scandal emerged involving Lance Armstrong. In June 2012, The United States Anti-Doping Agency charged Armstrong with having used illicit performance-enhancing drugs.⁴¹ On August 24, 2012, the USADA announced that Armstrong had been issued a lifetime ban from competition, applicable to all sports which follow the World Anti-Doping Agency code. The USADA stripped Armstrong of his seven Tour de France titles, highlighting that Armstriong had engaged in “the most sophisticated, professionalized and successful doping programs that sport has ever seen.”⁴² The Armstrong scandal further diminished repositioning efforts and tarnished the industry. Therefore, cycling federations once again had to regroup, refocus, and realign their market strategies. This situation further accentuates how situations outside of a marketer’s control can adversely impact market strategy.

Cycling is not the only sports entity attempting to reposition itself. Following a series of scandals with coaches and athletes, the NCAA is also experiencing image problems. And let’s not forget baseball players such as slugger Barry Bonds, who has some problems of his own. Individual athletes can produce image problems for themselves, a city, as well as a sponsor. LeBron James and “The Decision” left himself, Cleveland, and Nike to re-establish an image and reposition within the sports industry. One professional sport team, albeit a temporary tenant, can even serve to reposition an entire city, as discussed in the accompanying article.

Summary

Chapter 6 focuses on the critical market selection decisions, also referred to as segmentation, targeting, and positioning. Segmentation, the first market selection decision, is identifying consumers with common needs. Typically, the bases for segmentation of consumer markets include demographics, socioeconomics, psychographics, behaviors, and benefits. Marketers using demographic segmentation choose groups of consumers based on common ages, gender, ethnic background, and stage of the family life cycle. Geographic segmentation groups people who live in similar areas such as cities, states, regions of the country, or even countries (e.g., the United States versus international markets). Socioeconomic segmentation groups consumers on the basis of similar income levels, educational levels, and occupations. Psychographic segments are especially useful to sports marketers; they are based on consumers’ lifestyles, activities, interests, and opinions. Behavioral segments are groups of consumers that are similar on the basis of consumer actions, such as how often they purchase sports products or how loyal they are when purchasing a sports product. Finally, benefits segmentation are groups of consumers attempting to satisfy similar needs by consuming the sports product together. Sports marketers may choose to segment their markets using one of the previously mentioned segmentation variables (e.g., demographics) or combine several of the bases for segmentation (e.g., geodemographic).

Once market segments have been chosen, the next market selection decision is picking a target market. Target marketing is choosing the segment or segments that will allow the organization to most effectively and efficiently achieve its marketing goals. When evaluating potential target markets, care should be taken to ensure the markets are the right size (neither too large nor too small), reachable (accessible), measurable (i.e., size, purchasing power, and characteristics of the segments can be measured), and demonstrate behavioral variation (i.e., consumers share common characteristics within the target market). The final market selection decision is positioning. After the target market has been chosen, sports marketers want to position their products or fix them in the minds of the target markets. Positioning is based on the perception or image that sports marketers want to develop or maintain for the sports product. For example, a minor league baseball team may want to position itself as an inexpensive, family entertainment alternative. To understand how a sports product is positioned relative to its competition, perceptual maps are developed through marketing research techniques. By looking at perceptual maps, sports marketers can identify whether they have achieved their desired image or whether they need to reposition their sports product in the minds of the target market.

Key terms

  AIO dimensions

  behavioral segmentation

  benefits segmentation

  demographic segmentation

  ethnic background

  family life cycle

  geodemographic segmentation

  geographic segmentation

  market niche

  majority fallacy

  market segmentation

  market selection decisions

  mature market

  niche marketing

  perceptual maps

  positioning

  psychographic segmentation

  reposition

  social class

  socioeconomic segmentation

  target marketing

Review questions

1.  Describe the key components of market selection decisions and indicate how market selection decisions are incorporated into the larger strategic marketing process.

2.  What is market segmentation? Provide some examples of how sports marketers segment the sports participant market (those who play) and the sports spectator market (those that watch).

3.  Discuss the various ways to segment the sports market based on demographics. Which of the demographic bases are the most effective when segmenting the sports market and why?

4.  Describe, in detail, the family life cycle and how it is used as a strategic tool when segmenting sports markets. What stage of the family life cycle are you currently in? How does this affect your sports participation and spectator behavior?

5.  Provide examples of sports you believe would appeal to each of the six social class categories (upper-upper through lower-lower). What sports appeal to all social class segments?

6.  What are AIOs? What are VALS? Describe the similarities and differences in obtaining each, and evaluate which is more effective at segmenting consumers for sports marketers.

7.  Why is developing and maintaining an international presence important for sports marketers? What further considerations, if any, need to be taken into account when attempting to segment an international market? Provide several examples of the growth of international sports marketing.

8.  What is behavioral segmentation? What are some of the common behaviors that sports marketers would use for segmentation purposes?

9.  Define benefits segmentation and discuss why benefits segmentation is considered to be at the core of all segmentation. What benefits do you look for when attending a sporting event? Does your answer vary from event to event?

10.  Define a target market. What are the requirements for successful target markets (i.e., how should each target be evaluated)? Provide examples of sports products or services that target two or more distinct markets.

11.  How many target markets should a sports marketer consider for a single product?

12.  Describe positioning and discuss how perceptual mapping techniques are used by sports marketers. What is repositioning?

Exercises

1.  Find two advertisements for sports products that compete directly with one another. For example, you may want to compare Nike running shoes with Reebok running shoes or King Cobra golf clubs with Taylormade golf clubs. How is each product segmented, targeted, and positioned? Are there more differences or similarities in these market selection decisions?

2.  How is the health and fitness industry segmented in general?Describe the segmentation, targets, and positioning of health and fitness clubs in your area.

3.  You are hired as the director of sports marketing for a new minor league hockey franchise in Chicago, a city that already has an NHL team. Describe how you would segment, target, and position your new franchise.

4.  Describe the primary target market for the following: NASCAR, the Kentucky Derby, “The Rhino” bowling ball, and the WNBA. Next, define a potential secondary target market for each of these sports products.

5.  Interview five consumers who have recently attended a high school sporting event, five consumers who have recently attended a college sporting event, and five who have recently attended any professional sporting event. Ask them to identify why they attended this event and what benefits they were looking for. Were their needs met?

6.  Develop a list of all the possible product attributes that may be considered when purchasing the following sports products: a tennis racquet, a basketball, and a mountain bike. After you have developed the list of attributes, ask five people which attributes they consider to be the most important for each product. Do all consumers agree? Are there some attributes that you may have omitted? Why are these attributes important in positioning?

7.  How do you think the following races are positioned: Boston Marathon, “Run Like Hell” 5k Halloween Race, and the Bowling Green 10k Classic? Draw a two-dimensional perceptual map to illustrate the positioning of each race.

8.  Provide examples of individual athletes, teams, and sports (leagues) that have had to develop repositioning strategies.

9.  Find the Web sites for three professional sports franchises and go to their ticket section. How many special promotions do they offer? Which segment of the population is being targeted by each promotion? Are any segments excluded? If so, create a promotion targeting that segment and explain why it would be effective.

10.  Choose a professional sports team that performs poorly in attendance. Locate its Facebook page on the Internet. (If you cannot find it, choose another team.) Examine the content of the page. Are any special events or promotions being planned? How many friends/fans does the team have? As far as you can tell, what kinds of people are these (i.e. college students, professionals, families, etc.)? Develop a segmentation strategy that revolves around Facebook. How would you appeal to each segment?

Internet exercises

1.  Using the Internet, find the demographic profile for fans attending the LPGA (women’s tour) versus the PGA (men’s tour). Are there differences? Use this information to comment on the market selection decisions for the LPGA.

2.  Find two Internet sites that target children interested in sports and two Internet sites that target the mature market. Note any similarities and differences between the sites.

3.  Find two Internet sites for soccer. One site should focus on U.S. soccer, whereas the other focus should be international. Comment on the relative positioning of soccer in the United States versus abroad based on information found on the Internet.

Endnotes

1  1 James McNeal, “Tapping the Three Kids’ Markets,” American Demographics (1998); James McNeal, “Kids in 2010,” American Demographics (1999).

2  Dan Cook, “Lunchbox Hegemony: Kids & the Marketplace, Then & Now,” LiP Magazine (August 20, 2001).

3  L. Coffey, “10 Ways to Get a Grip on Sports Costs for Kids (2010); Mogosport, “10 Ways to Save Money in Youth Sports” (May 23, 2011). Available from: http://mogosport.wordpress.com/tag/youth-sports/.

4  Harris Poll, YouthPulse, Harris Interactive (2012). Available from: http://www.harrisinteractive.com/.

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