By

Chris J. Hart, Dr. Corinne M. Daprano, and Dr. Peter J. Titlebaum
University of Dayton

Chris J. Hart is a junior at the University of Dayton majoring in Sport Management.

Contents:

Elite sport has evolved over the past century from its humble beginnings and amateur ideal to sport as business and entertainment. The practice of sport marketing has changed considerably as well. Is there a place for ethics in this evolution of sport and sport marketing or are we witnessing an era of the “no holds barred”, “anything goes” mentality as sport marketers try to outdo each other to grab the attention of spectators, fans, and consumers? Are there acceptable rules or clear lines for what is ethical versus unethical marketing?

The marketplace in the United States and increasingly in the rest of the world is cluttered with many entertainment options and products (e.g., movies, music, cable TV, the internet) all meant to provide consumers with a variety of choices. Sport marketers must create more innovative and distinct ways of distinguishing their products from those of competitors to capture this increasingly fragmented market. The purpose of this article is to discuss: 1) the evolution of spectator sport from its amateur beginnings to sport as a vehicle for entertainment; 2) the role of sport marketing in this evolution; and, 3) the role of ethics in sport marketing while highlighting several questionable sport marketing tactics. We conclude this article with several questions meant to generate discussion regarding the role of ethics in sport marketing.

Spectator sport has evolved from an emphasis on the amateur ideal where independent clubs operated teams and sponsored athletes to the corporate structure of today. Within this corporate sport structure, entertainment and spectacle are emphasized and athletes are paid enormous sums of money to compete for “live” and perhaps more importantly, for television audiences. This current state of affairs is dramatically different from the beginnings of sport as an independent localized activity with religious, military and folk characteristics. Westerbeek and Smith (2003) suggest, “sport in its purest sense was never conceived as a revenue raiser” (p. 3).

Modern sport first developed during the mid-1800's and the beginnings of the Industrial Revolution. This development process, described by sport historians as “sportification[,] occurred when local sport-like activities evolved into standardized, internationally recognized sports” (Westerbeek & Smith, 2003, p. 55). The development of modern sport was further spurred by the widespread development of railways systems and automobiles. Athletes and teams were no longer confined to participating in local sport competitions. In addition, popular local sports developed standardized rules permitting national and then international competitions between teams and nations.

The development of modern sport into corporate sport has accelerated in the past several decades with the advent of television rights deals and the Internet. As a consequence “the ability for sport to generate substantial revenues has become the most prominent feature of corporate sport” (Westerbeek & Smith, 2003, p. 84). In such an environment “substantial” revenues must be generated through a variety of sources including gate receipts, television, sponsorships, and licensing. Thus, marketing has become an integral aspect of sport business and the primary means of assisting teams and leagues to generate the amount of revenue necessary to compete with other “entertainment” options. We now turn to a discussion of the role of marketing in the business of sport with examples of how companies use athletes to promote their products and the role of the media and technology in making it possible for marketers to use a variety of appeals to different target markets.

The Evolution of Sport Marketing

In the past, the marketing of sport was a straightforward process. Players were noticed and recognized for their on the field accomplishments: Babe Ruth and his home run record; Wilt Chamberlain for scoring 100 points in a single game; Pete Rose as the all-time hit leader. While these players had personal lives that allegedly included drinking, drugs, gambling, and/or womanizing, society did not pay much attention to these issues until their playing days were over. There were few sponsorship or endorsement opportunities for these athletes and the leagues were able to capitalize on the positive media their accomplishments generated.

All that changed when Michael Jordan became a household name. Jordan was the squeaky clean, perfect role model for everyone to embrace. Recently ESPN Classic aired a 60 Minutes interview with Jordan from several years ago. When the interviewer asked about his alcohol consumption, Jordan claimed he didn't drink and that he liked to work on his game to make himself the best player possible. Of course, neither the interviewer nor anyone else for that matter mentioned his excessive gambling, or alleged mistress in order to protect his marketable image. Jordan was tremendously successful on and off the court. His marketability brought him huge endorsement deals and generated millions of dollars for the Chicago Bulls and the NBA.

Today, with every aspect of an athlete's life open to the media, sport marketers and companies often walk a fine line between “keeping it real” and trying to appeal to a diverse base of fans and customers. Kobe Bryant of the NBA, another perceived clean cut player, lost many of his sponsorships after he allegedly raped a young woman. NBA players Jason Kidd and Allen Iverson had run-ins with the law when their respective wives filed domestic violence charges against both athletes. NFL running back, Jamal Lewis recently pled guilty to a charge of attempted possession of cocaine with the intent to distribute. Barry Bonds and numerous other professional baseball players have recently made headlines over the use of steroids in major league baseball.

Is this a sign of the downfall of our society? Hardly, professional sport has simply become part of the entertainment industry, and athletes have become entertainers. No longer are they athletes playing a game; they are celebrities in the public eye. Like any movie or rock star the paparazzi follow these athletes and the media scrutinizes their every move.

This morphing of spectator sport into corporate sport can be directly associated with the close connection between the media (i.e. television and the Internet) and sports. Television contracts have become the driving force for many sport leagues because of the amount of money produced by these deals. The NFL sold the rights to televise their games over eight years for US$17.6 billion. The rights to the 2004 Summer Olympic Games were worth US$1.5 billion, the 2006 World Cup is expected to generate US$1.28 billion, while Formula One racing brings in US$500 million per year (International Olympic Committee, 2005; FIFA, 2002; Levine, 2001). Watching a sporting event on television has become its own unique entertainment experience. Sport marketers and the corporations associated with sport are merely attempting to leverage this association to generate revenues.

Sport Marketing, Media and Technology

Sport marketers, then, are in a position where everyone is fighting to one-up each other. The sport marketplace in developed countries, such as the U.S., Canada, Western Europe, Japan and Australia, is saturated and more innovation and, some would suggest, more controversy have become necessary to stand out. In addition, since sport consumers represent such a diverse market, sport marketers have found it necessary to create marketing strategies to appeal to various groups of sport consumers (i.e. males, females, families, loyal fans, casual fans). This may not have been possible ten or twenty years ago, but technology has played a huge role in allowing marketers to segment their audience like never before.

Monberg (1997) describes these changes by observing that tracking companies have become very powerful because of their ability to literally find out everything about the consumer. Monberg (1997) discovered that as many as 1,400 pieces of information can be obtained from each household. The ability to track consumer's behavior has been gaining momentum recently with the advent of TiVo and the Internet, enabling marketers to track viewing, reading, and recording habits.

In this new “tracking age”, it has become easier to segment markets. Allen Iverson, with his tattoos, baggy clothes, and cornrows may not appeal to the white-collar suite holder, but there is a definite market the NBA is trying to reach by using Iverson in league marketing efforts. Iverson has the coveted “street creed” and marketers have found a way to sell his style as being a part of his “gangster” image. Because athletes can no longer hide their private lives, marketers can spin their troubled lives into something that sells just as is done with rebellious rock stars.

Ambush Marketing

In addition to using athletes to generate interest in sporting events, events have become venues for sponsorship. Companies pay to officially link their brand to a sporting event. Yet, with so much competition and the revenue generating potential of sponsorships, it's no surprise that ambush marketing has become a marketing strategy and yet another example of questionable ethical practices (Doust, 1997).

Ambush marketing, according to Meenaghan (1994), is “…the practice whereby another company, often a competitor, seeks association with the sponsored activity without payment to the activity owner” (p. 77). There are many ways a company can engage in ambush marketing, whether by advertising directly before and after the event, or giving away promotional items outside the venue that fans then take into the sport facility.

Is this ethical? Meenaghan (1994, 1996) argues that there are varying degrees of what is considered an ethical versus unethical practice. While there are some companies that try to imply their involvement in a sport event, others may be legitimately advertising on a broader scale. For example, a company may attach themselves to tennis while another sponsors a tennis event such as Wimbledon. Geoffrey (1993) would disagree, maintaining that all forms of ambush marketing are “outright robbery” (p. 68).

Further, the concept of ambush marketing is a gray area in a legal sense. In most cases, event organizations will attempt to settle these issues privately to avoid court costs and time (Ettorre, 1993). So, there is a heavy burden on sport marketers to consider the ethical impact their strategy has on their company and industry. Everyone in the industry wants to be noticed, and creatively discovering new ways to do so sometimes creates ethical dilemmas for marketers.

Sport Marketing to Youth

In the past few years, it's clear the efforts sport marketers will go to promote their product to the public. Marketing has penetrated all levels including high school and youth sport. High school sport programs today are becoming attractive to sponsors anxious to reach the youth market. Whether it is an official soft drink or shoe brand, companies are paying top dollar to market their products to school age children. iHigh.com is a new company that markets U.S. high school sport teams. Schools receive guaranteed revenue and in return sell space to sponsors.

What's more, high school athletes at the high school level are sometimes exploited to help schools generate revenue. When NBA player LeBron James was in high school his team traveled across the U.S. and played games on television. Sports Illustrated profiled James and OJ Mayo, a high school sophomore heralded as the next LeBron. Nike offered Kobe Bryant's high school money to sell his replica jersey. Soon more high schools in the U.S. may be promoting their star players in order to obtain sponsorship deals.

Is all this sponsorship ethical? Are we bombarding students and corrupting them?

According to a survey of professionals associated with the youth market (i.e. marketers, teachers, and media), sponsoring sporting events or branding high school sports was seen as “highly appropriate tactics to reach children” (Geraci, 2004, p. 15). People in the industry seem accepting of these tactics because it helps fund interscholastic sport programs. Considering how many schools in the U.S. have difficulty funding extracurricular activities, sponsorship may be the only way to allow youth to continue playing organized sport without paying to play.

Even Little League Baseball (LLB) has become a marketing tool. During the 2004 Little League World Series, televised on ESPN, players had their “stats” appear as they came to bat. The content was basic: height, weight, age, and hometown, with a “fun” question at the end—favorite actor or mom's best dish. But last year many of the players were asked to name their favorite X-Game athlete – the X-Games were on ESPN the following week. Additionally, LLB has “officially” endorsed products such as gloves, bats, and hats. Other “official” LLB products include rakes, bleachers, bases, training machines, and even lightning detectors (see www.littleleague.org/common/equipment for a list of all official LLB products).

The marketing and promotion of Little League Baseball (LLB) even extends beyond the field of play. LLB is sponsored nationally by all kinds of brands unrelated to their product. The point, here, is not to single out LLB. LLB is just one more example of an amateur sport becoming commercialized spectator sport; child athletes as child entertainers.

Clearly there are ethical situations that arise from the marketing of sport as a result of the evolution of spectator sport to entertainment. People may not be keen on the notion of children or amateur athletes being exploited, or rebellious professional players being used to market sport products. Yet, is this unethical, when our society accepts this type of marketing in other entertainment contexts? If we are unable to agree on what constitutes ethical versus unethical marketing in entertainment, there is little chance we can agree on ethical marketing standards as applied to sport.

Doust, D. (1997). The ethics of ambush marketing. Cyber-Journal of Sport Marketing, 1 (3).

Ettorre, B. (1993). Ambush marketing: Heading them off at the pass. Management Review, 82 , 53-57.

FIFA World Cup. (2002). FIFA World Cup and television. Retrieved March 6, 2005, from http://fifaworldcup.yahoo.com/releases/en/fwc_tv_en.pdf

Geoffrey, B. (1993). Be like Nike. Sales and Marketing Management, 145 (11) , 66-74.

Geraci, J.C. (2004). What do youth marketers think about selling to kids? International Journal of Advertising and Marketing to Children, 5 (3) , 11-17.

International Olympic Committee. (2005). Global broadcast revenue. Retrieved March 6, 2005, from http://www.olympic.org/uk/organisation/facts/revenue/broadcoast_uk.asp

Levine, J. (2001, July 9). Ringmeister. Forbes. Retrieved March 6, 2005, from http://www.forbes.com/global/2001/0709/052.html

Meenaghan, T. (1994). Point of view: Ambush marketing: Immoral or imaginative practice? Journal of Advertising Research, 34 , 77-88.

Meenaghan, T. (1996). Ambush marketing: A threat to corporate sponsorship? Sloan Management Review, 38 , 103-113.

Monberg, J. (1997). ‘You will': Social implications of advanced marketing technologies. Ethics and Behavior, 7 , 229-238.

Westerbeek, H. & Smith, A. (2003). Sport Business in the Global Marketplace . New York: Palgrave MacMillan.

1. Do you believe market segmentation has become an important factor in the cluttered sport marketplace?

2. Is there a correlation between marketing and your enjoyment of a sport?

3.Youth athletes have been treated similarly to child entertainers. Is it ethical to sell products by using youth athletes and leagues?

4. What athletes appeal to you?

5. Has marketing played a role in why certain athletes appeal to you?

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April 2005 - John Vincent, Ph.D. and Dr. Joanne Dusel will start with a new article.

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