6 Market research in the sport industry

Introduction

Sports marketing is a highly competitive industry where success depends on effectively reaching and engaging with a large and loyal fan base. To achieve this, market research and data analytics are crucial tools to help sports marketers understand their target audience and develop effective marketing strategies. While last week we discussed market segmentation and target marketing, it’s important to understand how fans perceive a sports brand.

This week we will emphasise the significance of market research and data analytics in sports marketing and how they can provide a competitive advantage. While you are already exploring these concepts in the Fundamental of Marketing Analytics unit, we will delve deeper and apply them specifically to the sports industry.

What is market research?

Market research encompasses various components beyond just telemarketing and focus groups in the new age of digital fan engagement. Sports organisations can use market research to gain a deeper understanding of their customers (fans), their environment, and the values that are significant to them.

There are numerous ways that market research can assist sports organisations. Watch the following video^[1] to get some insights into how some companies have used market research to better position their brand in competitive markets.

Now let’s test your knowledge on this video!

So that is interesting for non-sports brands but what are some of the most common ways sport clubs gather information from their fans?

• Focus Groups: Focus groups are always a collective of people (more than 2 people who are usually sat together) and asked their opinions on a topic.

According to Caroline Oates and Panayiota Alevizou (2018), the three types of focus groups that can be used by the sports marketing team to understand their fans better are unstructured focus groups, exploratory focus groups, and semi-structured focus groups. Focus groups are where a bunch of fans (can either be from a particular segment or just random) sit in a room and are asked questions about their thoughts and experiences^[2].

• Interviews: Interviews are valuable for sport marketers to gain insights into the thoughts and perceptions of their fan base, especially when focusing on specific segments such as female fans under 30, to understand their perspectives on their club or interest in sports.

However, interviewing fans is tricky (trust me I know) and to ensure you get the most out of the interview it is important to know how to ask the right questions! Let’s look at a research study conducted by Ron Garland and others who wanted to know why NZ Rugby Union had declined – in a similar fashion to the decline of Rugby Union in Australia^[3].

Here is some context for you.^[4].

You will find a full copy of their research in this weeks extended readings but basically the researchers wanted to find out two things;

1. To identify issues that influence New Zealand provincial rugby union spectators to attend professional provincial rugby events.
2. To identify the differential influence of these issues upon different groups of fans with a view to adopting segmentation strategies for subsequent marketing effort.

Through interviewing 150 fans they found that most important factor influencing attendance was the live sport action itself. However, other factors such as stadium conditions, atmosphere, and community involvement, affected different fan groups differently, indicating targeted marketing tactics may encourage home game attendance^[5].

Data Diving

Sports organisations can utilise a vast amount of data to inform their marketing strategies. Unlike interviews and focus groups, the collection and analysis of big data can provide a holistic picture of the market. This can include broad demographic information from sources like ABS data (Australian Bureau of Statistics) or more specific data gleaned from fan engagement with the sports organisation’s app, website, ticketing, and membership purchases.

Sports organisations can use different types of data to help guide their marketing strategies. Data can come from a variety of sources, such as fan engagement, demographic information, and data from Ausplay, which shows what sports people enjoy and how much they are moving. This information can be helpful for teams to grow their brand exposure and make sure they have fans for a long time, not just attending games.

Remember- having strong junior numbers is important for the financial success of sports teams, so it’s essential to improve the teams reach at the grassroots level. Using data in these ways can help sports organisations stay competitive and successful. Have a look at the most recent AUSPLAY report (click the link here)^[6] and answer the following questions.

Sports organisations can also collect data from their own platforms, such as their website, app, and ticketing system. This data includes information about who downloads their app, purchases tickets and merchandise, and who is reading news about player signings. For paid members of a sports team,  it is likely they may receive targeted emails about special tickets and discounts or personalised messages. For example, every year I receive an email from Everton Football Club wishing me a happy birthday! This data helps sport organisations to better understand their audience and create targeted marketing campaigns.

But it goes further…

Have a read of the article linked here called How The Patriots Use Data To Try To Improve The Fan Experience^[7]

As the above article explains, the New England Patriots, a professional American football team, have a team of data experts called the Kraft Analytics Group (KAGR) who collect data about their fans’ behaviours. They track fan purchases, ticket sales, email responses, and even parking lot attendance to understand their customers and improve their fan experience. KAGR’s data helps the Patriots make better decisions about game-day staffing, stadium improvements, and ticket prices. The team can also use this data to forecast when fans will arrive at the stadium and how many will show up for each game. KAGR even tracks which fans are missing games and why which means the Patriots can use this information to build stronger relationships with their fans. While some people might be concerned about the team collecting so much information, the Patriots say it’s a way to serve their fans better.

What is CRM and it relationship with market research in sport?

In this weeks additional reading Fried and Mumcu (2016) offers you a detailed explanation of what analytics in sports marketing can look like. They argue that the goal of sports marketing is to attract individuals to games and events, but being a fan does not always convert individuals into loyal attendees^[8]. Think about your own fandom – are you a fan of a club possibly overseas where you don’t necessarily attend the games or a fan of your local team but rarely make it to live games?

We know that the challenge for sport marketers is to convert fans into long-term loyal customers who are active in their consumption of tickets and other sport related items. Fried and Mumca (2016) explains that customer relationship management (CRM) then becomes a crucial tool for successful sport organisations to engage with their customers effectively by sending the right message, to the right person, at the right time via the right platform.

Mumca in her chapter on analytics in sports marketing argues that CRM systems provide a comprehensive view of an organisation’s customer base via information technology systems^[9]. Whilst this is a HUGE topic and you don’t need to know the intricacies of operating systems it is important to understand how CRM is increasingly becoming one of the most important tools for sports teams to use to hit the mark with their fans!

As the above video^[10] explores, Customer Relationship Management (CRM) and analytics are both important components of sports organisations. CRM refers to the processes and technologies used by sports teams to manage and analyse their interactions with fans and customers, while analytics involves the collection, processing, and analysis of data to derive insights and make informed decisions^[11].

So the relationship is simple! In the sports industry, analytics is used to build on a sports team CRM strategies by providing teams with a better understanding of their fans and customers. By analysing data from sources such as ticket sales, social media, and online engagement, teams can gain insights into their customers’ behaviours and preferences. This information can then be used to tailor marketing campaigns and improve the overall customer experience, ultimately leading to increased revenue and fan engagement.

Therefore successful sport organisations practice CRM as a business philosophy and use data analytics to understand their fans in great detail to build deeper long-term relationships and add value.