Marketing Objectives of Professional and University Sport Organizations

Transcription

1 Journal of Sport Management, 1992, 6, Marketing Objectives of Professional and University Sport Organizations Hal Hansen and Roger Gauthier University of Ottawa The heads of marketing and promotion for major professional and university sport organizations were asked to rate the relative importance of 19 marketing objectives on a 5-point Likert scale; 164 responded. Factor analysis resulted in the creation of six factors: player quality, community image of team, entertainment value of sport, team marketing, team as a contender, and attractiveness of game location. ANOVA, Tukey, and student t tests used on the data resulted in significant differences between leagues for the two factors of community image of team and entertainment value of sport. Professional teams favored 5 of 6 objectives over university teams: value of ticket price, entertainment value of the sport, image of the team, community-oriented nature of the team, and availability of athletes for community events. Literature Review The importance of goals to organizations is self-evident; goals exist and take on different forms depending upon the organization (Khandwalla, 1977). Bacilious (1968) has provided reasons for the importance of organizational goals, and Perrow (1961) explained the significance of operative goals: "[They] tell us what the organization is actually trying to do" (p. 180). Various sport organizations pursue different operative goals depending upon individual circumstances. Presumably, Canadian and American interuniversity teams and professional teams have different operative goals and, therefore, different marketing plans. Organizations' operative goals are determined to a large extent by influential, dominant decision makers within the organization (Perrow, 1961; Price, 1972; Thompson, 1967). It is assumed that individuals within professional and university sport organizations who are responsible for the marketing plans of their respective organizations are these decision makers. Operative goals provide the basis for devising marketing plans for sport organizations. Understanding factors that affect attendance provides the knowledge to formulate operative goals or objectives for these marketing plans: "The Hal Hansen and Roger Gauthier are with the School of Human Kinetics at the University of Ottawa, Ottawa, ON, Canada, KIN 6N5.

2 28 Hansen and Gauthier marketing concept holds that the key to achieving organizational goals consists in determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiently than competitors" (Kutler & Turner, 1985, p. 22). According to Schofield (1983), studies dealing withthe demand for sport entertainment as measured by attendance are termed demand studies. In demand studies, the focus is on reasons why fans attend games, in effect, utility of demand. Authors have pointed to many other factors and have shown how some have significant effects on attendance. In the Hansen and Gauthier (1989) paper, the literature is summarized into four categories. In the economic category, studies deal with price, per capita income, substitute forms of entertainment, television effects, and the effects of other sport attractions in the area. A second category is called sociodemographic, wherein studies focus on population size of an area, ethnic population, and geography. The category designated as ' attractiveness of the game contains factors dealing with promotions and special events, star players, the team as a contender, and team placement in league standings. The final category, residual preference, concerns the scheduling of games and fan accommodations. Schofield's (1983) categories are similar to those of other authors. Hart, Hutton, and Sharot (1975) listed economic, geographic, demographic, and the fans' perception of the game's entertainment value; Greenstein and Marcum (1981) outlined sociodemographic, accessibility, and performance as their categories. Few studies exist that focus on the organizational goals and marketing objectives of sport organizations. The studies cited by Hansen and Gauthier (1989) deal with factors affecting attendance at professional sport events, in particular, baseball. They analyzed 40 attendance items, derived 10 factor categories and cited differences between six North American professional leagues. Organizational goals for Canadian university athletic programs have been studied although not from the perspective of developing marketing plans. In one study, students provided their views of criteria for evaluating the effectiveness of interuniversity athletics. Satisfaction of athletes, spectator appeal, student recruitment, and sharing of costs were the four most important criteria (Chelladurai, Haggerty, Campbell, & Wall, 1981). These criteria could be reflected in the operative goals of universities' decision makers. Bird studied students' views of the functions of interuniversity athletics and found two functions: entertainment for spectators, and status for the university (cited in Chelladurai & Danylchuk, 1984). The goals expected for interuniversity athletics by students of Canadian universities were found to be athletes' personal growth, public relations, entertainment, prestige, and national sport development (Inglis & Chelladurai, 1983). Nine operative goals that universities differentially pursue were identified: transmission of culture, entertainment, national sport development, financial, career opportunities, public relations, athletes' personal growth, prestige, and achieved excellence (Chelladurai, Inglis, & Danylchuk, 1984). Administrators of Canadian university athletic programs considered the following as important operative goals: transmission of culture, athletes' personal growth, public relations, and prestige (Chelladurai & Danylchuk, 1984). American university athletic programs have the following common objectives: producing a winning team to satisfy the entertainment needs of fans,

3 Marketing Objectives 29 character development of athletes, enhanced image of the athletic program, growth of the program, profit, survival, and obtaining a fair share of the entertainment market (Broyles & Hay, 1979, pp ). Latham and Stewart's (1981) is the only study dealing with the objectives of a professional league. They studied the objectives of the National Football League and its relationship to the effectiveness of teams as indicated by their winning performance. They found that "winning teams seem to place somewhat less emphasis on entertainment and winning objectives relative to moderate and losing teams, but place more emphasis on certain other objectives, for example, survival" (Latham & Stewart, 1981, p. 408). Although a professional league may be defined as a cartel (Noll, 1974; Sloane, 1971) whose purpose is to restrict competition, fix prices, and divide markets among members of the industry, Markham and Teplitz (1981) argued that professional or university sports do not fulfill criteria associated with formal cartels. These sport organizations operate leagues with similar objectives in mind. As Markham and Teplitz (1981) stated, the league is the relevant unit for economic analysis of the sports industry, and that this proposition holds equal validity for the Ivy League, the Southwest Conference, and the Big Ten as it does for the American and National Baseball Leagues.... The important economic competition is not among the contestants but between the whole league and other forms of entertainment. (P. 100) Professional and university sport organizations provide an opportunity for their members to fulfill various marketing objectives, among which is the generation of revenue: The most interesting feature of the sporting demand function is competition between teams... consequently, mutual dependence is not confined solely to producing a game but also to producing a crowd, because the revenue of every club depends on the performance of both teams. (Jones, 1969, p. 227) The product of sport is the game involving two teams made up of skilled athletes performing according to common rules and, at least in the case of professional sport, satisfying a demand for entertainment. Attendance is a key determinant of revenues and, hence, of the profitability of the professional league and its teams. It can be argued that university teams and conferences fulfill similar objectives to professional teams. Summary There appears to be a variety of organizational objectives or goals pursued by sport organizations at different levels of emphasis. Understanding the factors affecting game attendance seems to be a basis for identifying objectives that market or promote a team so as to generate revenue in the pursuit of other goals, such as profit and entertainment. The league is an important unit of analysis because it is this unit that must have goals supporting its teams' objectives in competing for fans against other forms of entertainment. The constituents' perceptions about these objectives highlight the need to recognize differentiated approaches to the marketing and promotion of teams

4 within leagues and between professional and interuniversity organizations. The rationale provided for studying goals of interuniversity athletics in Canada seems in part to justify the purpose of this study: "The significance of studying operative goals is that the differences in the weighting of these operative goals may underlie tlie divergent and conflicting views... of intercollegiate athletics across Canada" (Chelladurai & Danylchuk, 1984, p. 34). Purpose Knowledge of the relative importance of objectives for teams in various settings "can enable managements to choose those strategies which will generate the greatest benefits relative to their cost" (Siegfried & Eisenberg, 1980, p. 59). The purpose of this study was to have key decision makers determine the relative importance of marketingjpromotion objectives for their respective sport organizations. Second, because the literature is limited regarding studies dealing with marketingjpromotion objectives of sport organizations, the generation of specific factors was pursued, involving the total sample as well as three subsamples of professional, NCAA, and CIAU teams. Third, because sport organizations pursue various objectives, determining specific differences among these organizations would augment the literature. Procedures Methodology Nineteen statements for the marketing and promotion of a team were derived from the surveys of Broyles and Hay (1979) and Latham and Stewart (1981). These statements were representative of four categories of factors affecting attendance and were randomly distributed throughout the questionnaire. These statements and the instructions to the respondent, "indicate the relative importance of each of the following factors/thrusts for promotingjmarketing your team," were assumed to represent objectives a team would pursue when developing its marketing plan. A 5-point Likert scale was used to ascertain the relative importance of each statement to its effect on the marketingjpromotion of the team. Reminder letters with questionnaires were sent to nonrespondents within 1 month of the initial waiting period. The survey was completed during the winter of Subjects Questionnaires were sent to the head of marketing and promotion of each team in the following sport organizations: Canadian Football League (CFL), N=8; National Football League (NFL), N=28; National Hockey League (NHL), N=21; National Basketball Association (NBA), N=23; Major Indoor Soccer League (MISL), N=l 1; major league baseball, N=26; National Collegiate Athletic Association (NCAA) Division I, N=250; Canadian Interuniversity Athletic Union (CIAU), (N=43). In order to present a perspective of differences in approaches to marketing objectives, the sample of 164 was subdivided into professional, NCAA, and CIAU football and basketball teams as well as being grouped according to professional or university status.

5 Marketing Objectives 31 Statistical Analysis Descriptive statistics were generated for the 19 statements in terms of the three major samples (see Table 1). Factor analysis using the principal component model followed by varimax rotation was applied to each statement (Nie, Hull, Jenkins, Steinbrenner, & Bent, 1988). The criteria used for the inclusion of items in each factor were (a) that each item should have its highest loading on the same factor, and (b) that each item loading should be higher than SO. Coefficient alpha, developed by Cronbach (1951), was used to assess the internal consistency of the questionnaire, which was.85 for the season. All results were analyzed using the ANOVA procedure. Where results were found to be significant, the Tukey post-hoc procedure was used to determine the exact nature of the difference. Significance was set at the.05 level. The student t test was used to determine differences between professional and university groupings. Results and Discussion The response rate for each team in the sample was as follows: CFL=6 of 8 (75%), NFL=20 of 28 (71%), NHL=11 of 21 (52%), NBA=13 of 23 (57%), major league Table 1 Descriptive Statistics for Marketing Objectives of Professional, NCAA, and ClAU Organizations Objective Pro. NCAA ClAU (n=74) (n=62) (n=28) M SD M SD M SD U The entertainment value of your sport A Your team as a contender U Excellence of your sport U The image of your team A The winning nature of your team U The tradition of your team R Locationlsetting of games A Competitiveness of your division U The spectacle of your sport, E To target certain populations E To increase number of sponsors R Community-oriented nature of your team R Length of time team is in the area A Your athletes' star status E To increase special event occasions E Value of ticket price R Availability of athletes for community events A League records held by your team/athletes A Team records held by your athletes Note. A=attractiveness, E=economic, U=utility of demand, R=residual preferences.

6 32 Hansen and Gauthier baseball=14 of 26 (54%), MISL=lO of 11 (91%), NCAA=62 of 250 (25%) (football=34, basketball=26, hockey=2), CIAU=28 of 43 (65%) (football=14, basketball=l 1, hockey=3). Table 1 presents descriptive statistics for the 19 objectives and three subsarnples. Of the first 6 objectives in descending order, 4 fall within the utilityof-demand category; the remaining 2 are in the attractiveness category. The utility grouping has a focus on entertainment value from the fan's viewpoint; one could infer that the fan is attracted by a positive team image, tradition, and the excellence of the sport and, overall, is receiving good entertainment value when combined with the team-as-a-contender and winning-nature items. Factor Analysis The total sample of 164 teams was used for the factor analysis, and six factors were derived (see Table 2). Each factor was named according to the individual items within. In previous studies (Broyles & Hay, 1979; Latham & Stewart, Table 2 Factor Loadings of the Marketing Objectives Factor Loading Factor 1: player quality A League records held by your teamlathletes A Team records held by your athletes Factor 2: community image of team R Community-oriented nature of your team R Availability of athletes for community events U The image of your team E Value of ticket price Factor 3: entertainment value of sport U The entertainment value of your sport U Excellence of your sport U The spectacle of your sport Factor 4: team marketing E To target certain populations E To increase number of sponsors E To increase special event occasions Factor 5: team as a contender A Your team as a contender A The winning nature of your team A Your athletes' star status Factor 6: attractiveness of game location R Locationlsetting of games A Competitiveness of your division Note. A=attractiveness, E=economic, U=utility of demand,!&residual preferences.

7 Marketing Objectives ), clusters of objectives were not evident. Chelladurai, Inglis, and Danylchuk (1984) derived nine clusters of objectives for the scale of athletic priorities. However, none of the studies related the objectives to the marketing or promotion of a team. The factors from this study provide the reader with specificity of objectives as related to 164 individual teams or sport organizations. Thus, the six factors can be pursued in the development of marketing plans by respective teams (Chelladurai & Danylchuk, 1984; Khandwalla, 1977; Zeigler, 1980). A team may decide to market or promote its "player quality" in order to satisfj the entertainment needs of its fans and, hence, increase attendance and, ultimately, revenues (Hill, Madura, & Zuber, 1982). No11 (1974) elaborated on this topic of player quality: "Stars add substantially to the drawing power of baseball, even without considering their effects on the playing success of their teams7' (p. 123). In order to seek support for the objectives generated from the literature, factor analysis was applied to the professional, NCAA, and CIAU subsamples. Seven factors resulted for each subsample as compared to the six factors derived for the total sample (see Table 3). Sample sizes account for this difference in factor quantity. The objectives clustered in each factor point out the differentiation of emphasis by each organization. For example, in Factor 1, the emphasis of the professionals is placed on objectives focusing on entertainment value, team image, and community orientation; hence the name community image of team. The NCAA stressed an economic focus, with objectives such as sponsors, special events, and the targeting of populations being loaded on the factor named team marketing. The CIAU objectives of competitiveness, an athlete's star status, team records held by athletes, and league records held by team and athletes loaded on the factor 1 that focused on player quality. Other distinctions based on the loadings can be made for each remaining factor.' Table 3 Comparison of Factor Categories by Sport Organization Factor Pro. NCAA ClAU Community image of team Player quality Team marketing Team as a contender Ticket value Team history in area Entertainment vafue of sport Team marketing Player quality Community image of team Team as a contender Player quality Team marketing Team as a contender Community image of team Entertainment value of Team history in area sport Location/setting of games Locationlsetting of games Ticket value Performance records 'Loadings per objective for each of the three organization samples may be 6btained from the authors.

8 34 Hansen and Gauthier The objectives cited by Latham and Stewart (1981) fall within Factors 1, 4, 6, and 7 of the professional teams. Those of Broyles and Hay (1979) relating to American universities are contained in Factors 1, 2, 4, and 5 of the NCAA. Some of the objectives or operative goals involved in the studies by Chelladurai (Chelladurai et al., 1981; Chelladurai et al., 1984) can be found in the factors of the CIAU: Specifically, transmission of culture is related to Factors 2,4, and 5; prestige to Factor 4; public relations to Factor 3; entertainment and spectator appeal to Factor 6; financial to Factor 3; and achieved excellence to Factors 1 and 7. Other objectives such as personal growth, national sport and development, and career opportunities cannot be supported by the factors of the CIAU (see Table 3). In summary, the six factors derived for the 164 teams contain some or all of the objectives mentioned in the literature review. Specific relatings of objectives from the literature to the professional, NCAA, and CIAU subsamp indicated support for the seven factors generated in this study. This study provid specific marketing factors that can be used as a basis for marketing plans various teams. "In baseball, the excitement of a close pennant race, a star player s quest for an all-time record, or the presence of a potential Hall of Famer could certainly inflate attendance levels" (Siegfried & Eisenberg, 1980, p. 33). By identifying marketing objectives, one can attempt to differentiate between organizations and between successful and unsuccessful organizations. "Ideally, good marketing generates more customers than you had before at the turnstyle... as well as building a higher level of satisfaction among all the many 'publics' important to your success" (Gilbert, 1978, p. 16). League Differences Because a variety of organizational objectives can be pursued by sport teams depending upon individual environments, determining the emphasis placed on marketing objectives by individual leagues could provide a perspective of their respective marketing orientations. One must assume that these organizations operate with similar objectives in mind (Markham & Teplitz, 1981), for no statistically significant differences between leagues for any of the 19 objectives were found. However, there were differences noted for several leagues on Factors 2 and 3. The CFL differed from the four university sport units (see Table 4); it would appear that the marketing emphasis of the CFL on team and athlete involvement in community events explains the difference. Similar significant differences were also found between the university sport units and the MISL. Further, the MISL differed from other professional leagues regarding the marketing emphasis represented by Factor 2. The marketing factor of entertainment value provided significant differences between the MISL, the NBA, and NCAA football (see Table 4). The results could be explained by the apparent need for the MISL to be energetic in its marketing plans so that indoor soccer could counteract the prominence of more typically American sports (NFL, NCAA, NBA) and obtain a share of the sport market. Professional Versus University Notwithstanding the lack of differences among leagues for any of the 19 objectives, when the sample was grouped by professional and university orienta-

9 Marketing Objectives 35 Table 4 League Differences on Factor 2, Community hnage of Team, and Factor 3, Entertainment Value of Sport Factor N F League M League M Community image of team *' CFL CFL CFL CFL Entertainment value of sport ** ClAU BB ClAU FB NCAA BB NCAA FB ClAU BB ClAU FB NCAA BB NCAA FB NBA NFL NHL NBA NCAA FB Note. BB=basketball, FB=football. *p.05; "pc.01. tion there were 6 objectives for which significant differences were found (see Table 5). With the exception of the locationfsetting of games, higher means were found for the professionals on the remaining 5 objectives. The specificity due to individual team and league markets as well as team orientations would outweigh any direct conclusions drawn from the results of this aspect of the anaiysis. However, given the literature attention to university objectives such as athletic satisfaction, program growth, student recruitment, Table 5 Differences Between Professional and University Teams Professional University Objective n M SD n M SD Tratio Value of ticket price p<.0090 Locationlsetting of games w.0175 The entertainment value of your sport pc.0001 The image of your team p<.0047 Community-oriented nature of your team pc.0225 Availability of athletes for community events pc.0001

10 36 Hansen and Gauthier sharing of costs, character development of athletes, national sport development, and career opportunities, one could assume at least some differentiation between the orientation of professional sport and that of university sport. Summary This study generated six factors of marketing/promotion objectives (see Table 2). These factors provide specificity of objectives as related to 164 sport organizations. The individual objectives clustered within the six factors can be related to the literature designations of utility of demand, attractiveness, economic, and residual preferences. These six factors could provide team personnel (key decision makers) with information to market or promote a variety of objectives depending upon respective team circumstances and individual environments (Chelladurai & Danylchuk, 1984; Khandwalla, 1977; Zeigler, 1980). When the 164 teams were subdivided into professional, NCAA, and CIAU, seven factors were derived. For example, Factor 1 shows (a) the professionals stressing entertainment value and community orientation of the team, (b) the NCAA focusing on the economic aspects, or team marketing, and (c) the CIAU having a priority for player and team quality (see Table 3). No significant differences between leagues for any of the 19 objective statements were found. However, significant differences were found for Factor 2, community image of team, and Factor 3, entertainment value of sport. Leagues involved in these factor differences were the CFL and the MISL, whose marketing orientation appeared to be the reason for the differences compared to university leagues, the NBA, the NIX, and the NHL. Finally, significant differences were found for 6 objectives between professional and university sport organizations. In summary, various sport organizations pursue different operative goals depending upon individual circumstances. In this study, Canadian and American university and professional teams had varied marketing objectives and (one could infer) would then have different marketing plans based on these varied objectives. References Bacilious, Z.F. (1968). Organizational goals-the problems of goal distortion and displacement. The Canadian Administrator, 7(6), Broyles, J.F., & Hay, R.D. (1979). Administration of athletic programs: A managerial approach. Englewood Cliffs, NJ: Prentice-Hall. Chelladurai, P., & Danylchuk, K. (1984). Operative goals of intercollegiate athletics: Perceptions of athletic administrators. Canadian Journal of Applied Sport Sciences, 9(1), Chelladurai, P., Haggerty, T.R., Campbell, L., & Wall, S. (1981). A factor analytic study of effectiveness criteria in intercollegiate athletics. Canadian Journal of Applied Sport Sciences, 6(2), Chelladurai, P., Inglis, S., & Danylchuk, K. (1984). Priorities in intercollegiate athletics: Development of a scale. Research Quarterly for Exercise and Sport, 55(1), Cronbach, L.J. (1951). Coefficient alpha and the internal structure of tests. Psychometrika, 16(3), Gilbert, B.R. (1978). The marketing of a sports program, Athletic Administration, 13(2),

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