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37 Cards in this Set
- Front
- Back
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Who has rights to merch |
it equal control (also who ever financed or put in the capital) Similar to F&B |
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Decisions points (self op or 3rd party) |
Financial (self op make more profit) Buying power (not as important as F&B because can't buy in bulk as much) Liability - not as much as F&B because can't go back but have to worry about things going obsolete Competition - with other retail stores Risk overall is not as high as F&B Easier to operate and less man power needed More control over logo usage and color scheme |
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Turnkey operations (merch) |
Venue pays for everything and the venue is "merchandise ready" and so they get the highest royalty rate possible. *concessionaire rarely finacnes merchandise operations fully |
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Royalty Rates (merch) |
It is normal a type of gross deal with rates dependent on type of mercy. Lower cost items 30% middle cost items 25% high cost items 18% *compared to F&B merchandise costs are higher therefor royalty rates are lower *Merchandise will get about 10% profit back not matter the item |
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Labor costs (merch) |
Lower than F&B because no prep and it has fewer per capita visits *playoffs drive LOTS of mercy revenue |
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Revenue enhancement opportunties (merch) |
Player marketability (different jerseys i.e. throwback) Different styles Retail stores (must be careful and strategic about this) Limited editions/catalog Internet/onlin orders |
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t-shirt profit margins (Merch) |
Sell for $20 Cost $4 profit margin $16 80% Team gets 30% so $6 March left with $10 so they get 50% |
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Jersey profit margins (Merch) |
Sell $250 Cost $ 160 profit margin $90 so 36% Team gets 18% $45 March left with $45 so they get 18% |
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League licensing revenue |
Leagues own the team logos and rights thereon League gets royalty from manufactures (who sell mercy to retailers and to all the teams to see it in the stadiums) and it is split evenly between all teams Teams only get to get all royalty rate from merch sold in the stadium. |
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What (Sponsorships) |
What do you sell/give a sponsor: naming rights, signage, broadcast, print, promotions (give aways, product demonstrations, testing/sampling), PA announcements, jumbotron, community/PR programs, player appearances, and hospitality |
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Why (Sponsorships) |
Why should a company/brand buy a sponsorship: Exposure/awareness, goodwill, DRIVE TRAFFIC, provide goods or services, hospitality, EGO, exclusivity, association/prestige, tickets/suite, corporate purposes, B2B |
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Who (Sponsorships) |
In house or 3rd party: In house - control, give commissions, must recruit/hire/train/retain employees 3rd party - easier to terminate, have to worry about loyalty, ability, &cost **Must service sponsor once you have them to keep them |
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How (sponsorships |
cold call, always start during the season, CLIENT KNOWLEDGE, provide value to them, reputation, relationships, leverage parent companY, SERVICE & CREATIVITY ** best one |
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Role of Sponsorship Dept |
service client, understand why client advertise & market, understand what your event, than, venue can offer your clients, and charge max $$ **nothing happens until something is sold |
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How do sponsors use the event/team/venue |
What can you (team, venue, event) give your sponsor must be in presentation and everyone must know!
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What type of relationship between team and sponsor in sponsorships |
RECIPROCAL - both get something out of relationship
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What does the team get in sponsorships? |
revenue, In-kinds goods or service (barter), Media (anytime a team is mentioned in tv, radio, or print) branding ("official sponsor of...)
**good sponsor will ask a lot of you |
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What does the sponsor get in sponsorship? |
awareness, image enhancement, demonstration PLATFORM (stadium, event, team), hospitality, product trial/sales opportunities,
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Contract Elements in sponsorships |
Term, Fees & Costs, exclusivities, product placement, ticket allotment, everything the sponsor gets, what event/team/venue gets, exclusions (coke says you can't sell peps or no porno), promotional rights (types of ads), logo usage, guarantees (attendance or ratings), Make wholes (given more ads if guarantees not met), termination, league rules, rights of 1st refusal, battered or in-kind elements |
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Deal Sheet |
summarizes contract (financial and operational summary of sponsor contract) by itemizing sponsor elements Uses the rate card to determine prices Contains: payment terms, management approach, commissions, billing info, utilization, special terms and conditions (for playoffs) |
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Rate Card |
MSRP (manufactures suggested retail price) Used to determine utilization. Wha to aver 80% utilization if not close then your prices are off The team sets the rate card. |
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Finance role in sponsorships |
Make/update rate cards, establish inventory, approving deals, billing, collection, and credit approval, Budgeting, assist or lead in contract negotiations, and influence or leverage service or product providers |
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Sales personal will always.... |
take the path of least resistance |
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Fees |
What the brand/company pays the team for sponsorship |
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Costs (sponsorship) |
What the team spends to execute sponsorship. This is either paid by sponsor or reimbursed by sponsor. |
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Utilization |
the effectiveness of the element Most average 80% Based off you rate card example: item cost $10,000 You sell it for $8,000 then utilization is 80% You sell it for $20,000 then utilization is 200% |
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Rights to broadcast |
Granted by the league. Driven by contacts. Where the bulk of money comes from. There has been a HUGE increase in the money for this. More people come to a game the lower the per caps |
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League rights vs team rights |
The team gets the local (sphere of influence which is determined by the league) and the league gets the national and international rights. The leagues rights trump the teams rights. The league revenue is split evenly between the teams while each team gets to keep all the profit from their local deals so they make more money from local broadcast |
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Local vs national broadcast |
Team has local and league has national. Networks pay for exclusivity of national games. Most teams will try to schedule around the national games so that their games can get broadcasted and they can receive the money from that. |
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Types of broadcast deals |
Rights fee, airtime purchase, revenue sharing |
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Rights fee (broadcast deal) |
Stations pays for everything (team, production, and sells all advertising and risks of selling. The team maintains control of broadcast but has no financial risk. Must be worth it for the station so only for events that are really popular (guaranteed money makers) Revenue for team is guaranteed and predictable |
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Airtime purchase (broadcast deal) |
Team purchases a block of time from the state and the tam pays for the production and sells all the ads. The team has all the financial risk and this is because the event or team is either under performing or risky. Revenue for station is guaranteed and predictable |
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Revenue Sharing (broadcast deal) |
Cost and profit shared between team and station so equal share of financial risk. Both sell adds but this has major logistics and decision challenges. |
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Broadcast deal considerations |
Team leverage (more popular = rights fee), scheduling/programing, screen advertising, exclusivity, ratings, term, risk, ability to sell commercials, resources, termination, control over content |
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Radio broadcast deals considerations |
Frequency - you want AM travels farther Dial address - the lower the better Signal strength - at night they power down because the signal travels farther Direction of attain/signal Station format - sport or talk signal strength- want more watts so it goes farther Run of station (ROS) advertising |
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Media partnerships |
It is significant and the most powerful marketing vehicle for a sports franchise. It is used on air, in game, and co-op advertising. Has many creative challenges, forward thinking, and constant management. IT CAN'T BE OVER EMPHASIZED. |
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Different types broadcast rights |
TV, cable, radio, internet, pay per view |
