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SM 203 Exam 2
| Question | Answer |
|---|---|
| Where does the bulk of revenue in pro sports come from? | Sale of media rights |
| How many pro leagues does North America have? | 5 |
| What is the benefit of unions for athletes? | Allows them to negotiate for wages and benefits |
| Which pro league is not unionized? | MLB affiliated leagues |
| What is the most important factor for individual athletes' income? | Sponsorship |
| What was the first pro team? | 1869- Cincinatti Red Stockings |
| What was the first pro league in America? | MLB in 1876 |
| Corporate governance | Owners act as board of directors, comissioner acts as cheif executive officer |
| Territorial rights | limit franchise from moving into another team's territory w/o permission and compensation |
| Revenue sharing | gives teams a portion of various league-wide revenues |
| Which league has strictest eligibility for franchise ownership? | NFL has strictest rules, prohibits corporate ownership and recently loosened rules on cross ownership |
| Who was the first pro commisoner? | Kennesaw Landis (MLB) |
| Pete Rozelle's importance | Commisioner that focused on marketing and pioneered revenue-sharing. Introduced the "league think" of doing things that are best for the league, not for the individual team |
| First players association | John Ward established the Brotherhood of Professional Baseball Players |
| Role of labor relations | Labor relations did not play a major role until lae 60s. Growing fan interest, revenue from TV sponsors transformed leagues, giving more bargaining power to players |
| Collective Bargaining Agreement (CBA) | Negotiated between leagues and player associations |
| Lockout | Management not allowing players to play |
| Impasse | Breakdown in negotiations |
| Which sport is heavily linked to charity? | PGA- has donated over 2.5 billion |
| Which league has no salary cap and revenue sharing? | MLB- this has caused competitive balance problems in teams in bigger markets. |
| What determines a franchise's value? | 1. Degree of revenue sharing 2. Stability of league's labor situation |
| Rooney Rule | NFL rule requiring teams looking for coaches to interview minority coaches |
| What jobs are front office entry level? | Sales, marketing relations and media departments |
| Role of foreign markets | Important, especially in global sports like basketball. Foreign markets generate around 20% of TV revenue in NBA |
| Sabermetrics | empirical study of baseball |
| Agency Models | Free standing Law practice-only frim SM firm affiliated w/ law firm |
| 5 Key Problems with sports agents | 1. Income mismanagement 2. Incompetence 3. Conflicts of Interest 4. Excessive fees 5. Aggressive client recruitment. |
| From Reading Check: What league first created the position of commisoner to govern the best interests of the sport? | Major League Baseball |
| From Reading Check: True or False: The WNBA league and teams are primarily female-operated organizations | True |
| From Reading Check: True or False: In 1876, North America's first pro league, the National League, was organized | True |
| From Reading Check: True or False: Many lawsuits concerning a sport agent's incompetence, fraud and breach of fiduciary duties involve financial planning and investing. | True |
| From Reading Check: When negotiating and endorsement contract the agent should be certain to maintain the client's exculsive rights and control over his/her... | image and endorsements |
| From Reading Check: The NFL settled lawsuits concerning concussions possibly leading to diseases such as Alzheimers, dementia, due to head trauma while playing pro football. How much was the final settlement amount? | $1 billion |
| From Reading Check: Many individuals in the management of pro sports leagues are not fans of salary caps because they... | All of the above Routinely provide teams with spending floors so low-revenue teams are prevented from cutting salaries to stay competitive, routinely force teams to cut vets to get under cap, have loopholes |
| From Reading Check: Pro golfers must earn a right to compete on the PGA tour annualy. How do they qualify for it? | All of the above. Vets can maintain qualification from prior year's performance in PGA Tour, best players move up through the ranks on WEb.com tour, players who make the cut move straight to PGA Tour, Top 25 of Q-school move to Web.com Tour |
| From Reading Check: Five key problems in the sport agency profession do NOT include: | The agents' lack of understanding of the rules of the game. |
| stadium | derived from ancient Greek "stade"- site for the early Olympics |
| 60s + 70s stadium building | Cities started funding and building stadiums instead of the teams, bringing touring concert industry to stadiums and resulting in "cookie cutter" stadiums. |
| SSS | Soccer specific stadiums |
| Lamar Hunt | Owner of Columbus Crew, built first SSS in U.S. |
| Importance of facilities in relocation | Facility that a pro team plays has most significant impact on its profitability, often primary consideration in choosing to remain or move |
| Arenas | Indoor facilities that host sporting and entertainment events (usually multiple sports) |
| Convention centers | almost always built and owned by a public entity |
| University venues | Market is generally dictated by student population |
| Theaters | building or outdoor area designated for plays or other performances |
| Concerts schedule | Usually booked on average six months before date |
| Cost of Big Four Sports venues | $37 billion |
| bond | an interesting bearing certificate issued by the govt or corporation, promising to pay interest and to repay a sum of money. |
| Two tax exempt bonds: | general oblication and nonguaranteed bonds |
| general obligation | repaid with portion of general property taxes and require voter approval |
| nonguaranteed | sold on the basis of repayment from designated revenue sources |
| Hard taxes | local income, real estate, personal property, general sales (often require voter approval) |
| Reasons for subsidizing facilities | Improve the economy, create jobs, generate spending, attract tourists, multiplier effect |
| Ticket rebate | part of the surcharge that consumers must pay when they purchase a ticket to an event. |
| Marketing fund | a pool of money that is reserved from the profiits of other shows |
| Alcohol | one of the largest revenue drivers in venues |
| Barnstorming tours | Using star athletes and teams to promote a particular sport, pioneered by Spalding in 1870s |
| Sport marketing and event management agency | business that acts on behalf of a sport property |
| Largest full-service agency | WWE/IMG |
| Functions of event mgmt | Finance, risk management, tournament operations, registration, volunteer management, event marketing |
| zero-base | requires a review of all activities and related costs of an event, forces perspective of all operations to maximize event management |
| Cash-flow budgeting | Accounting for the receipt and timing of all sources and expenditures ofcash |
| Risk management | Function by which an organization identifies and manages the risks of liability that rise from its activities |
| Integrated marketing | Entails long term strategic planning to manage functions in consistent manner. |
| In-kind sponsorships | cash-free exhange of sponsorship between events and media outlets. Event provides sponsorship benefits to media outlet for free ad spaces |
| Gantt chart | shows the activities, tasks, events that need to occur associated with an event displayed against time. |
| Leader in sponsorship revenue growth | NBA $16.3 billion spent on sponsorship in 2016 |
| Sponsorship Activation | More sport sponsorships requiring that sponsor commits financial resources in support of its sponsorship |
| Sales promotion | Variety of short-term promotional activities that are designed to stimulate immediate product demand (famous in baseball) |
| Premiums | items offered for free or low price as incentive to buy a product or service |
| Sampling | One of the most effective sales promotion tools to induce consumers to try a product |
| Point of sale marketing (POS) | used to attract consumers' attention to their product at the retail level (example: cardboard cutouts) |
| Cross promotion | Joining together of two or ore companies to capitalize on sponsorship (allow companies to share cost of sponsorship) |
| Q-score | Tests to measure marketibility of athletes |
| Four factors of consumers purchase | Quality, quantity, time, cost |
| Fan Cost Index | Measure of cost of taking a family of four to a pro game |
| Direct email communications | Allow a team to driectly contact and target potential buyers |
| Inside sales | Sports staff of young or inexperienced personnel that receive training to sell tickets |
| Benefit selling | creating, promoting new benefits to offset perceptions or negatives related to product |
| Upselling | trying to get consumers to upgrade |
| Eduselling | educating customer and ensuring product is being utilized properly |
| Retention marketing | marketing to keep customers, viewed through lifetime value |
| Proximity marketing | Form of location based advertising powered thorugh data based profiles, where communication with a consumer is timely, relvant and personal. |
| History of sport analytics | In 1990s and early 200s, companies emerged to provide teams, leagues and managers with the newest technological and data-driven tools. (Baseball fueled growth of analytics) |
| Sport marketing analytics | Examines buying habits, sensitivity to pricing, attitudes toward events or campaigns |
| 5-Tool Profile | Ask right questions, collect correct data, understand stats to properly model data, interpret data, communicate finding |
| Analytics center of excellence | ACE: All anaytcis personnel are grouped together fulfilling tasks across multiple departments. |
| Decentralized structure | individual analytics employees are embedded into each department to help address needs of groups. |
| analytics vendors | provide solutions and services to the end users for different application areas. |
| Wearable analytics | provides data and performance insights based on the biometric activity of the user. |
| Rights fees | rights to transmit coverage of various events to audiences, major source of revenue for leagues and organizations, risen in past years |
| FIrst sports broadcast | In 1921, KDKA broadcast the first live sport program in a boxing match between Johnny Dugan and Johnny Ray. |
| First sport-related program sponsor | Royal Typerwriter Company |
| Pittsburgh Athletic Co. v KQV Broadcasting Co. | Cour ruled that the owner or organizer has control over access to venue by broadcasters. Stil lexists today |
| Roone Arledge | Producer that revolutionized broadcast TV by taking "fans to the game" |
| Sports Broadcasting Act of 1961 | provided antitrust exemption for pooled media rights agreements |
| First primetime sport programming series | Monday Night Football |
| Cord-cutting | More people are ditching cable deals for streaming, digital content |
| NFL media rights | NFL receives the largest rights fees of any American sports organization |
| Target markets in sports | Sellers of products appealing to sports demographic will pay a premium for their ads to run in programs watched by their target markets. |
| Revenue sharing in MLB, NBA, NHL | Bigger markets earn larger rights fees for local telecasts, have to share less. |
| Individual events media funding | THe funding for prizes in individual events usually come from media rights fees |
| Time buy | When a rightsholder pays for time from a network at a price equivalent to the network's profit margin for producing, selling ads, and televising other programming |
| TYpical ad time | 30 seconds |
| NFL commercials | Required to have five 2-minute commercial breaks per quarter |
| Ad pricing | Price of ads is determined by network's ratings |
| Ratings | The percentage of households having at least one tv set that are tuned to a particular program (Nielson Company ratings) |
| Share | % of Tv sets actually in use tuned into a show |
| Blackout | Game not shown on TV when there are not enough tickets sold at event |
| Most valuable international property | NBC's coverage of the Olympics |
| International sport w/ most impact on U.S. TV market | Soccer |
| Fragmentation | More TV networks, availability of other media fragment audience to where fewer people are likely to choose one offering |
| From reading check: The trend over the past two decades has been single-purpose stadiums (t/f) | True |
| The (blank) is responsible for landing and scheduling events for a facility. | Booking director |
| (from reading check) Redmandarin is a London-based sport marketing agency that focuses on advising corporations on how to maximize their involvement with sponsorship opportunities. As such, Redmandarin is known as... | A specialized agency |
| (From reading check): A sport marketing and event management agency is defined as a business | initially established to represent the legal and marketing interests of athletes |
| (From reading check): T/F: Innovation in the sales process and methodologies within the sport industry have often been more advanced then those used in other service industries | False |
| From reading check: T/F: The Los Angeles Olympic Games were able to make a profit for the host city because of the large number and diversity of corporate sponsorships they signed. | False |
| From reading check: In measuring ROI from sport sponsorships, companies have used all of the following methods except | Qscores Scale |
| From reading check: Beacons are located in stadiums and serve up contextual communications for each location in the stadium. They are a part of (blank) marketing. | Proximity |
| From reading check: As a condition of granting a license for use of video highlights, a rightsholder can insist on having the right to approve the content of the program containing its footage. (t/f) | True |
| From reading check: In 1970, Monday Night Football debuted. It was the first sports programming series... | in primetime |
| From reading check: The difference between the economic impact upon a municipality by a convention center as opposed to a stadium or arena built for housing sporting events is | Visitiors receive the benefits of a convention center? |
| From reading check: All of the following were publicly financed stadiums efficiently build with the intention of housing both a football team and a baseball team except | Meadowlands |
| From reading check: The validity of a waiver used by events to reduce the potential for a lawsuit is determined by the law in each state, and therefore will vary across state lines (T/F) | True |
| From reading check: ESPN opts to manage the summer and winter X Games in-house, which are a direct result of the growth in sports TV. (T/F) | True |
| From reading check: Mark McCormack, founder of IMG, explained that selling consists of all the following except... | having a winning team or product |
| From reading check: T/F: Proximity marketing is a form of location based on advertising powered throuh data based profiles | True |
| from reading check: What college athletic program was the first to create a TV network devoted just to their school? | Texas |
| From reading check: All the major pro sport leagues have launched their own networks. List in chronological order the launching of each of the following. | NBA, NFL, NHL, MLB |
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PiMpSiNtHeCrIb