Urska Dobersek, Ph.D.
Department of Psychology
University of Southern Indiana
8600 University Blvd.
Evansville, IN 47712
Phone: (337) 853-7237
Urska Dobersek is an Assistant Professor in the Psychology Department at University of Southern Indiana. Denise L. Arellano is an Instructional Designer at the University of Dallas.
Investigating the Relationship between Emotional Intelligence, Involvement in Collegiate Sport, and Academic Performance
The purpose of this study was to investigate the relationship between student-athletes and non-athletes on emotional intelligence (EI), and whether or not the involvement in collegiate sports moderates the relationship between EI and academic achievement as measured by the grade point average (GPA). An independent-samples t-test revealed that non-athletes were more empathetic than student-athletes; no other dimensions of EI (i.e., utilization of feelings, handling relationships, self-control) were significant. A hierarchical regression analysis suggested no moderation effects as evidenced by the interaction term explaining an additional 1.9% of the total variance. After removing the interaction terms, the model indicated a positive relationship between empathy, self-confidence, and academic performance. Additionally, student-athletes demonstrated a higher GPA compared to non-athletes. Some findings of the current study are incongruent with the previous research suggesting the need for the further research on EI. (more…)
U.S. Sports Academy2017-07-05T14:53:09+00:00August 17th, 2017|Research, Sports Coaching|Comments Off on Investigating the Relationship between Emotional Intelligence, Involvement in Collegiate Sport, and Academic Performance
Outsourcing is a crucial tool that allows sport organizations to turn over their noncore processes to external service providers. The outsourced service providers help sport organizations focus on sales efforts to maximize revenue. The purpose of this study was to examine outsourced marketing in NCAA Division I institutions from the outsourced marketing companies’ perspective. A survey was conducted to gather information from the general managers at the primary outsourced marketing company’s property affiliated with select schools in NCAA Division I conferences. Collected data were analyzed with descriptive statistics along with qualitative responses. The study found that the outsourced marketing firms focus on revenue generation through securing corporate sponsors. Primary inventories sold included commercials during radio broadcasts of games and signage at athletic facilities. These are typically packaged with the sports of football and/or men’s basketball. The study found that many sponsorship categories remained unfulfilled. There was also growing concern by the companies regarding the escalading financial guarantees paid to the schools. The findings and recommendations are valuable to college administrators, athletic directors and outsourced marketing firms as the parties strive to find outcomes beneficial to everyone involved in the partnership.
More and more collegiate athletic departments have adopted outsourcing as a strategy which uses their corporate partners, such as State Farm, Burger King or Verizon Wireless, to help them earn additional revenue in exchange for advertising at the sporting events. Outsourcing is a crucial business strategy that allows companies to turn over their noncore processes to external service providers while the company concentrates on its core competencies (18). In the highly competitive environment of intercollegiate athletics, some schools are able to handle its corporate partnerships with in-house marketing departments. However, the growing trend for major NCAA Division I schools is to outsource its marketing efforts to an outsourced marketing company that specializes in the sales of inventory such as commercials on radio broadcasts or coaches’ television show, corporate hospitality at home sporting events, signage at athletic facilities and more (24, 38).
The athletic department will typically sit down and outline what they would like to see from an outsourced partner (2). For most schools, outsourced companies offer the opportunity to streamline operations or provide resources that might not otherwise exist, such as sales expertise (24). Li and Burden (24) add that the athletic department may want a company to produce radio call-in shows or coaches’ television shows in addition to the sales efforts. The outsourced companies would have a greater opportunity to improve the quality of the broadcast and simplify the production efforts.
Host Communications, International Sports Properties (ISP Sports) and Learfield Communications were viewed as the main outsourced marketing companies in the early 2000’s (38). Nelligan Sports was also seen as an emerging outsourced marketing company. These outsourced companies handle sponsorship sales while the in-house marketing department shifted its attention to promotions and increasing attendance and ticket sales. The outsourced company would maintain a “property” at the school with the property serving as an extension of the parent company. The property was responsible for the sales efforts and reporting back to the parent company.
The benefits of the outsourced marketing partnership are that of guaranteed and additional revenue (19). An outsourced marketing company will promise a financial guarantee of a set amount to the school’s athletic department in exchange for being able to sell the “rights” of that athletic department. Another option includes a simple revenue-sharing model for the “rights.” The rights could be in the form of a radio commercial, an on-field promotion, a giveaway at a sporting event, or signage at an athletic facility including on a video board (38).
To a lesser extent, the outsourced company will also sell advertising in game programs, on ticket backs and on the athletic department’s website. A fan might pick up a schedule poster and schedule card at a football game with a sponsor’s logo on it. That sponsor may also have a permanent sign at the football stadium visible to fans and may also host a corporate village for its clients prior to the game. In exchange for its advertising opportunities, the sponsor will pay the outsourced marketing company an agreed upon amount of money. The outsourced marketing company will then put that revenue towards the promised guarantee for the athletic department. Once the guarantee is met, the athletic department receives an agreed upon percentage of any future revenue, but it is there that the outsourced company earns its greatest financial sales commission. If this financial model is not used the straight revenue sharing of each sponsorship sold is another viable option.
As these outsourced marketing companies gain more schools under their watch, they spread their sales territory and can start to package a few schools with one corporate sponsor. For example, ISP Sports may approach Verizon about a national sponsorship deal that could reach the Northeast through sponsoring Syracuse University, the West Coast through sponsoring UCLA, the Midwest through sponsoring the University of Houston and the Southeast through a sponsorship of Georgia Tech Athletics. At the same time, Verizon may also discuss a similar deal with Host Communications through sponsoring the athletic departments at Texas, Boston College, Arizona, Kentucky and the University of Michigan. Companies might also pursue schools in a set geographic region, further enabling them to partner with corporate partners exclusive to that particular region. By strategically acquiring attractive schools (those with large market areas and large fan bases) around the country, the outsourced marketing companies can pool their resources, reduce their costs and diversify their portfolio of schools at the same time.
A number of studies have examined the perceptions of athletic directors and senior staff administrators from the institutions that partner with an outsourced company about their relationship with their outsourcing partners (10, 19, 24, 25, 38). Issues examined include details of the outsourcing contracts such as the length of the term, the financial guarantee, and the strengths and weaknesses of the outsourced partnership. This current study provided the outsourced company a chance to respond with its own sentiments about the relationship and future issues related to outsourced marketing. An analysis of the schools’ responses in conjunction with the responses of the outsourced marketing companies could help make for a better relationship in the future. The purpose of this study was to examine outsourced marketing in NCAA Division I institutions from the outsourced marketing companies’ perspective.
An Overview of Outsourced Marketing in Intercollegiate Athletics
The most significant outsourced marketing deal to date took place early in the fall of 2004 as Host Communications won the rights to the University of Kentucky athletics in a ten-year deal valued at more than $80 million. Host placed a bid of $80.475 million edging the bid of $80.35 million submitted by Learfield Communications, while ESPN Regional bid $74 million and Viacom Sports $55.25 (29). The previous deal was $17.65 million over the course of five years and expired April 15, 2005 (20). This deal established a benchmark that has since been surpassed, but clearly raised the fair market value.
To look at the origin of outsourced companies’ involvement with athletic departments, it is necessary to start in Lexington, Kentucky, and the origin of Host Communications. In 1973, Jim Host bid on the rights for the University of Kentucky in what is the first believed outsourced deal in intercollegiate athletics. Within ten years, Host had secured the rights to the Final Four after convincing then NCAA president Walter Byers that corporate marketing was the wave of the future (34). Host saw the opportunity that existed in advertising and licensing given the affinity associated with the college sports fan.
In working with colleges and universities and their marketing efforts, what Host strived for was a clean venue comparable to the Olympic Games where there was limited signage and less clutter in the advertising. The corporate partners who paid the most would receive these exclusive opportunities to advertise. Host notes that the philosophy is not applied to the Bowl Championship Series which is run outside the control of the NCAA (34).
Today, Jim Host is no longer head of the company he started, but he has enjoyed seeing the company grow to the point that it sells advertising on over 500 radio stations for the Final Four (5). This is up from the 200 radio stations the company partnered with in 1982 (12). Host also prints game programs for over 43 NCAA championships and operates most marketing and promotional aspects of the NCAA events. It annually earns over $100 million in revenue (7) and has not limited itself to just intercollegiate athletics. Event marketing in junctures as diverse as Streetball and the National Tour Association (tourism industry) have led the company to be recognized by the SportsBusiness Journal as one of the top five marketing companies in the world and the premier in intercollegiate athletics (6). In 2007, global sports marketing giant IMG purchased Host Communication, as the company exists today as IMG College (17).
In time, other companies began to surface to challenge Host Communications as the “one-stop” shopping point for colleges and universities. The companies realized what athletic departments were failing to grasp, that season-ticket holders were more than just fans who wrote a check once a year for seats to a sporting event. These fans were consumers that could spend up to $100,000 or more during a lifetime on tickets, concessions, and parking (22). In addition, the fans were loyal to their teams and everything associated with their team.
Corporate partners began to realize this and wanted to partner with schools. With money to be made and Jim Host demonstrating some early financial return on investment for the University of Kentucky, more start-up outsourcing companies wanted to become involved in their revenue opportunity. Some of the companies were locally owned and operated, but others were more regional like an ISP Sports, Learfield Communications, or Nelligan Sports. Companies and athletic departments sat down to best figure out which schools were good fits for which company and how to best utilize the relationships over the long-term. After that outsourced companies began to provide sponsorship options or packages to corporate sponsors based on what other schools were doing (22).
In creating packages of what could be sold, the typical items included signage at the athletic facilities, television rights and radio broadcast rights (14). Cohen adds that higher dollar values were attached to such sponsorship packages and enabled athletic departments to offset growing expenses including scholarships and rising facility costs. Schools would “bundle” their inventory and see more of the revenue return directly to the school instead of multiple outside parties (13). Outsourced marketing enabled corporate sponsors to visit one individual or company instead of stopping at the radio station to gain radio advertising during game broadcasts, stopping at the local television station to gain on-air advertising during coaches’ television shows, then concluding with a visit to the athletic department for additional advertising signage at the athletic facilities. This is especially true as video boards became more and more detailed in intercollegiate athletic facilities starting with the University of Nebraska in 1994 (31).
As scoreboards have been supplemented or replaced with video boards fans are now afforded instant replays and advertising messages. A full-color video board could now offer “fan of the game” or “play of the game” or “great moments in history” segments that are presented in collaboration with a corporate sponsor. It could also roll a commercial exactly like the ones seen on television at home. Steinbach (31) noted that with their addition of video boards, Michigan State experienced a sponsorship revenue increase from $400,000 in the pre-video days in 1998 to more than $3 million annually by 2002.
While these video board improvements provided new fan entertainment and sponsorship revenue, they did not come without a price. Many older fans thought the video board was too much like the television they chose to leave at home. Others felt the noise was too distracting and took away from the natural elements of the sporting event including the fans’ cheering, the band and cheerleaders (15). Athletic administrators and outsourced companies had to evolve to package their advertising in subtle fashion around trivia contests, historic moments, replays and scores from around the country. Pure video commercials advertising products were not welcomed in the stadium as it distracted from the entertainment aspect of the game itself. Furthermore, sponsors recognized that if fans were not happy with the advertising, their affinity to the sponsor would not be positive either. Too much advertising could also lead to a clutter of sponsors with their advertising messages being lost on the fans (15). The message was heard by the outsourced companies which now included Viacom Sport and Action Sports Media in the mix.
Recent Concerns in Outsourced Marketing
Arizona State University completed a study in 2004 on a small sample size that found that in intercollegiate athletics, sponsorships are typically formed in the categories of: airlines, auto parts, beer, credit cards, DSL, gas/oil, health and fitness, long distance, paging devices, and tires/auto services (3). The same group also found that categories frequently ignored include: auto parts, boats/marines, computer hardware/software, delivery services, department stores, drug stores, electronics, hardware/home improvement, music stores, pharmaceuticals, personal hygiene, video game systems and video stores. One major concern is that ignoring these categories can result in significant lost revenue. Tim Hofferth, president and chief operating officer of Nelligan sports stresses that outsourced companies cannot ignore pre-existing business relationships between schools and area businesses as those are additional sponsorship opportunities waiting to happen (23). This is particularly important as the parent outsourcing companies, with a greater portfolio of schools, pursue national sponsorships that are more financially viable to the parent company relative to the schools’ properties pursuing regional and local sponsorships. Therefore another concern is that local relationships can be impaired or even lost.
Additional research by Walker (36) noted that it is important that communication between the outsourcing property and the school remain a high priority. Because of the athletic department’s affiliation with an institution of higher education there are certain restrictions that exist that may not be as prevalent in professional sports. Such restrictions may central on alcohol, gambling or lottery sponsorships or trying to maintain a “clean” image at the sporting events to avoid concerns of excess commercialization within higher education. Goals, philosophy and objectives between the school and property must be aligned (11).
Future research needs to also explore whether the escalating guarantees paid to schools have grown too rapidly for the outsourcing companies to keep pace. After Kentucky signed their landmark deal, Connecticut, Arizona, Tennessee, Alabama, Michigan, Texas, North Carolina, Florida, Ohio State and Nebraska have since signed contracts guaranteeing at least $80 million to their schools from their respective firms (29). Wisconsin, Oklahoma, LSU and Arkansas are all guaranteed at least $73 million through their school’s contractual obligations with outsourced marketing firms.
Outsourcing as a Strategic Alliance: A Brief Overview
As competition becomes more and more intensified, individual firms have to seek out strategies to stay competitive. One of such strategies is strategic alliances (16). The age of in-house operations is quickly being replaced by the age of alliances (16).
According to Spekman and Isabella (30), an alliance is a close, collaborative relationship created between two or more firms for the sake of accomplishing some goals that would be difficult for each to accomplish alone. By collaborating, alliance partners will not act in self-interest, but will promote the partnership and foster its strengths. There are several benefits of forming a strategic alliance. According to Parise and Casher (26), a strategic alliance is characterized as “an open-ended agreement between two or more organizations which enables cooperation and sharing of resources for mutual benefits, as well as enhancement of competitive positioning of all organizations in the alliance” (p. 26).
1. Strategic alliances exist to create value. Whether or not it is in the form of new market penetration, increased profit sharing, or competitive opportunities, companies join to reap the benefits that neither partner could enjoy alone.
2. Strategic alliances are developed to create a number of advantages. Some of these advantages are opportunity-based alternatives. In other words, strategic alliances can provide firms in the alliance with many opportunities to reposition themselves in the market because the infrastructure network created by the alliance gives all members access to a range of information, markets, technologies, and ideas that would be far beyond their reach otherwise (16, 27). Due to the fact that it is often difficult for a particular firm to possess all the resources required to meet new challenges and opportunities, the formation of an alliance can be extremely advantageous (16).
3. Strategic alliances are developed to divert corporate attention away from nonessential efforts where the firm lacks expertise, cost advantage, or scale. The skills gained through new partnerships can introduce new techniques, market segments, or new geographic markets, and the addition of complementary skills also helps boost revenue opportunities by gaining greater returns from existing customers, channels, and products (1, 30).
Outsourcing within intercollegiate athletics is a viable means for an athletic department to utilize strategic alliances to create value and take advantages of skills that may not be found with the in-house marketing staff. The outsourced marketing firm can focus on revenue generation while the in-house marketing staff enhances event atmosphere and boosting attendance.
The general manager at the primary outsourced marketing company’s property affiliated with select schools in NCAA Football Bowl Subdivision conferences was the original subject of this study. The select NCAA Football Bowl Subdivision conferences included such six conferences as the Atlantic Coast Conference (12 schools), Big East Conference (12 schools, including four independents), Big Ten Conference (11 schools), Big Twelve Conference (12 schools), Pacific Ten Conference (10 schools), and Southeastern Conference (12 schools). Each of these six conferences is a member of the Bowl Championship Series, the leader in the Football Bowl Subdivision, formerly Division I-A, post-season play. Furthermore, earlier research by Zullo has indicated that a majority of schools outside of these six selected conferences affiliated with the Bowl Championship Series do not have an existing relationship with an outsourced marketing group (19).
With the six BCS conferences, there are a total of 69 schools. Among these 69 schools, 13 handle their marketing in-house and an additional seven were marketing in-house and recently reached an agreement to start a relationship with an outsourced marketing partner (19). That left 49 schools with outsourced marketing relationships. However, seven schools used multiple companies in their outsourced marketing efforts rather than pooling their efforts bringing the number of included participants down to 42. For example, one firm may sell signage at the stadium while a second sells radio inventory. These schools were not included as this research focused on school’s exclusive outsourcing partnerships only.
The main outsourced parent companies include ESPN Regional, Host Communications (presently called IMG College), International Sports Properties (ISP Sports), Learfield Communications, Action Sports Media, Nelligan Sports, and Viacom Sports (presently called CBS Collegiate Sports Properties). An examination of these companies found an additional 19 Division I schools with outsourced marketing relationships. These 19 schools are not in the six major conferences but have been included in the study to increase the sample size to 61.
To achieve the objectives of this study, a questionnaire was designed and utilized to examine the outsourced marketing companies’ perspective pertaining to their affiliations with NCAA Division I institutions. The researcher designed the questionnaire in consultation with four account executives from two major sports marketing firms. These four reviewers were not general managers with the outsourced marketing properties thus they could freely express their suggestions and concerns. This collaboration enabled further critique, expertise and anonymous feedback to enhance the instrument’s validity. Further review by academic colleagues aided in the process of eliminating biased questions or clarifying wording. The questionnaire and consent form were then sent to the general managers of the outsourced marketing companies’ operations at 61 major NCAA Division I institutions.
Both close-ended and open-ended questions were included in the survey instrument. There were nine open-ended questions. They were (a) what is the property’s best method of soliciting sponsors? (b) what are the primary goals of outsourced companies? (c) how often do outsourced companies fail to meet their financial guarantee to their schools? (d) what inventory sells the most, the least and why? (e) what sponsorship categories are presently being sold and which are ignored in sales? (f) why do outsourced companies sell certain sports and not others? (g) what are the strengths and weaknesses of outsourced marketing companies? (h) what do outsourced marketing companies perceive as the future problems with outsourced marketing? and (i) at what level is outsourced marketing a good fit within college athletics?
Data Collection and Analysis
The survey instrument was mailed to the respective general managers with a second mailing added to heighten the response rate. Descriptive statistics, such as frequencies were used to analyze the collected data. Qualitative responses were also analyzed to identify reoccurring themes.
RESULTS AND DISCUSSION
As mentioned previously, the purpose of this study was to examine outsourced marketing in NCAA Division I institutions from the outsourced marketing companies’ perspective. Twenty-eight general managers of the identified sixty-one NCAA Division I institutions responded to the survey, which accounted for a 46% response rate.
Primary Goals of Outsourcing Marketing Operations
In conducting their sales efforts, most surveyed properties (93%) focus on personal selling efforts as their means of reaching out to potential partners or sponsors. Telemarketing and using a database are secondary methods of soliciting sponsors or partners. These sponsorships or partnerships are secured for the primary purpose (68%) of generating revenue for the overall parent company to meet the guarantee to the school. After that goal is met then the secondary focus becomes trying to bring in additional revenue beyond that initial guarantee. This is consistent with previous literature by Burden and Li (9-10) and Zullo (38). The findings are also congruent with the strategic alliance research that place an emphasis on the value of partnerships yielding enhance values to both parties (26).
Table 1 Property’s Best Method of Soliciting Sponsors/Partners/Clients
Table 2 Primary Goals of Outsourced Marketing Properties
As mentioned earlier, this revenue is ultimately shared with the affiliated institution of higher education’s athletic department. It should be noted that the surveyed general managers indicated that outsourced properties focus on sales and not on the business of enhancing an athletic department’s marketing or promotional efforts. The outsourced properties responding also did not indicate a willingness to boost ticket sales or create awareness for the athletic department. This is also in line with past research by Zullo (38) and Burden and Li (9). Consistent with research in strategic alliance the in-house marketing departments focus on the areas of ticketing and brand awareness while the outsourced firms avoid such areas where they lack expertise and experience (1, 18, 30)
Duration of Relationship and Success Rates
Of the outsourced properties responding, 42% have been working with their current school for over six years and 54% have worked with their school for less than six years. There was one non-response. Twenty of the twenty-eight properties have successfully met their financial guarantee to the school’s athletic department throughout the duration of the relationship with the remaining eight respondents choosing to not answer the question. Of those eight, the subsequent question found that two of them have failed at least once to meet its financial obligation to the school’s athletic department. That is collectively a success rate of greater than 90% for the outsourced marketing properties in meeting their financial guarantees to the schools.
Table 3 Number of Years Property Has Worked With School
Table 4 Number of Years Property has Successfully Met Financial Guarantee
Table 5 Number of Years Property has Failed to Meet Financial Guarantee
If one tallied the cumulative number of years that all of the respondents have partnered with their respective outsourced marketing firms, factoring in the two years the guarantee was not met, that pooled annual success rate improves further thus supporting the philosophy of such alliances as advantageous (16, 30). Why companies failed to meet their guarantee could be asked on further questionnaires to help facilitate what factors impact not meeting the guarantee. Additional questions could also explore whether the escalade in financial guarantees paid to the schools by the properties has hindered the success rate. Furthermore, questions could also ask whether joint bids have become a necessity with the higher paid guarantees. ISP Sports pursued joint bids with IMG College before the latter company acquired the former in 2010 (4).
Attractiveness of Marketing Inventory
In examining what inventory items are sold most by the outsourced properties, the respondents cited radio broadcast of games (61%) and permanent signage (57%) at athletic facilities as the best selling inventory. These findings are consistent with Cohen’s findings (13-14) and Zullo’s research in 2000 (38). Video board advertising and ribbon signage at athletic facilities are other top sellers on the second tier of inventory, along with game day promotions and print media. Steinbach noted (31) that while start-up expenses for video boards may be higher the boards can offer a significant return investment. A third tier of inventory would consist of coaches’ radio shows, coaches’ TV shows, corporate hospitality, and the athletic department’s internet advertising rights.
Table 6 Best Selling Inventory Items
The idea of an interactive marketing area or fan zone that is increasingly being found at professional sporting events has not caught on as a popular inventory item at the college level yet. This may be due to the greater expense of such a project relative to the production of a radio commercial or one time cost of making a sign to display in an arena or stadium. An interactive area or fan zone’s costs and expenses could offer a lower financial return on investment for the outsourced marketing property.
The findings indicate that inventory provided by the athletic department and sold by the outsourced marketing company is limited. As professional sports are quick to sell more creative inventory, including corporate hospitality, ribbon stripe advertising in arenas and more fan friendly websites, institutions of higher education, athletic departments and outsourced marketing companies appear to continue to do business in the same way over the last decade as shared by Zullo’s (38) research. Athletic departments that prefer the permanent signage route over ribbon advertising or video board are not maximizing their revenue opportunities. Though accompanied by greater start-up costs, the ribbon advertising and video board messages garner greater fan interest and can be sold at a higher rate to the corporate sponsors. Outsourced companies may provide greater access to this newer technology enabling schools to add inventory they could not otherwise do on their own thus demonstrating another value of the strategic alliance (16, 27).
In terms of which sponsorship categories have been filled by the outsourced marketing property in the last three years, 71% of the respondents maintained some form of sponsorship in the categories of sit-down restaurants, fast food, hotel, soda/cola, banking, cellular service provider, car insurance, hospital/medical center, grocery store, automobile brand, life insurance, pizza and airlines. What is notable is the wide range of categories left unfulfilled by outsourced marketing properties including: water, health clubs, credit cards, real estate, tires, military, home improvement, dairy, automotive repair, motor oil, office supply store, tools/power equipment, coffee, satellite television, batteries, delivery services, boats/marinas, and candy. These findings are consistent with the study conducted at Arizona State (3).
Table 7 Sponsorship Categories Successfully Filled in Last Three Years
There are many categories typically sold in professional sport that are ignored in intercollegiate athletics. Future research is needed to address why this is the case. Is the sponsorship not a good fit for the college setting? Have companies tried approaching these categories and failed in their sales efforts? Or are companies aware that a greater financial return can be found with select categories relative to others? Additional research is warranted in this area as strategic alliances may yield new revenue opportunities and open new markets (1, 30), but only as these questions are explored further.
Attractiveness of Sports as Outsourcing Inventories
When surveyed general managers were asked what sports sold well when working with corporate sponsors or partners, the overwhelming response indicated football first and men’s basketball second. Women’s basketball and baseball were second tier sports in the sales effort. However, football and men’s basketball sold the best because that is what the sponsor/partner demanded (79%) in the sponsorship package first and it was demanded based on the historical perception of greatest return on investment value.
Table 8 Top Three Sports Outsourced Properties Sell
Table 9 Reasons for Selling Such Sports
Other sports simply did not garner the sponsor’s interest (71%), offer a significant return on interest (18%), or yield a past history of success in sales (11%). This was especially true of Olympic Sports and women’s athletics excluding women’s basketball. Low regular attendance at Olympic Sporting events equates to low return on investment from the sponsor’s perspective.
Table 10 Top Three Sports Outsourced Properties Did Not Sell
Table 11 Reasons for Not Selling Such Sports
This should not be interpreted as a dislike of these sports, but rather as a financial decision by corporate sponsors. A State Farm or AT&T corporate sponsor has the ability to reach many more fans at a football game then at a tennis match due to the larger attendance of patrons at the football games. Such a sponsor may also have the capability to advertise to a broader audience on the radio and television via the broadcast of the football and men’s basketball games. These findings are consistent with Zullo’s study (38).
Though this may be an area of concern between athletic administrators and outsourced marketing companies, most schools’ administrators understand the financial implications if an outsourced marketing company focuses too much time on selling sponsorships for a softball game instead of football or men’s basketball. The financial guarantee would not be met by the outsourced company and their services would not be retained. While the guarantee would be paid by the property’s parent company, the school would lose confidence in the property’s ability to sell and would look to partner with another company. It is a balancing act by the outsourcing marketing companies and many of these companies have offered to package Olympic Sports or women’s athletics with football and men’s basketball sponsorship packages provided that the corporate sponsor did not object. That noted, schools such as Georgia, Texas, or Stanford may need to explicitly state in their contracts with an outsourcing company that Olympic Sports and women’s athletics must be sold, given the high status of such programs at these schools.
Strengths and Weaknesses of Outsourced Marketing
Respondents noted that the major strength of outsourced marketing properties includes revenue generation (57%) with service quality ranking second. The weaknesses of outsourced marketing properties range from lack of control over content to lack of interest and promotion for certain sports. This reaffirms the previous research of Zullo (38) and Li and Burden (24).
Table 12 The Major Strengths of Outsourced Marketing
Table 13 The Major Weaknesses of Outsourced Marketing
Future Problems/Issues Facing Outsourcing Marketing
The respondents indicated the biggest future problem in outsourced marketing is too great of a financial guarantee for a school (50%), one that an outsourced marketing parent company may have trouble meeting on an annual basis. Smith (29) found that an increasing number of schools were surpassing the 2004 benchmark Kentucky deal as financial guarantees to school were reaching the $100 million mark. Secondary problems include clearly demonstrating a return on investment for sponsors (18%), an oversaturation of the marketplace with sponsorships, and turnover in sales personnel (both 14%). Tertiary concerns include ambush marketing, faculty concerns of over commercialization, increased operational expenses, and lack of control over the inventory and sponsorship content.
Table 14 Biggest Future Problems of Outsourced Marketing
Overwhelmingly, the respondents supported NCAA Football Bowl Subdivision institutions (96%) and conferences (61%) when they were asked the level of intercollegiate athletics outsourced marketing that is best suited for outsourcing. Lower levels of intercollegiate athletics simply did not catch the interest of outsourced marketing properties. Their response is consistent with Tomasini’s (35) findings, as well as those of Zullo (38) and Li and Burden (24). It is hypothesized that this is due to the smaller audience in attendance at sporting events at these levels compared to the NCAA Football Bowl Subdivision institutions.
Table 15 Level of Intercollegiate Athletics Outsourced Marketing is Best Suited For
CONCLUSIONS AND APPLICATION IN SPORT
Direct Practical Recommendations
Given the limited amount of research concerning outsourced marketing in intercollegiate athletics, research on outsourcing in higher education in general is important to consider when deciding whether to outsource sports marketing efforts. In examining the findings of this study and turning it into practical applications for presidents, athletic directors and general managers of outsourced marketing companies, the author would suggest the following recommendations for improving the business relationship and being pro-active in addressing future issues in outsourced sports marketing within the context of higher education:
1. Utilizing their acknowledged strengths, outsourced marketing companies should offer their consulting services in the area of marketing and sales to “smaller” Division I schools in non-BCS conferences that would not otherwise be financially attractive to partner with for an extended relationship. Their sales expertise would be considered invaluable to a smaller school and could be an extended revenue stream for the outsourced company collectively. Smaller schools could be packaged by entire conferences, or by several schools in same geographic region, or other characteristic (ex. HBCUs); outsourced companies could sell their season ending tournaments or championships, or “classic” games, etc. Smaller schools should also think in terms of packaging their entire campuses and not just the intercollegiate athletics department. This would help outsourced marketing companies address their concerns with the escalating financial guarantees paid to certain school that reduce the profit margin of the parent company.
2. Outsourced marketing companies must include new categories in their sales efforts as today’s sponsors simply have more places to spend their advertising dollars. Without a clearly defined return on investment, long term corporate partners may consider advertising elsewhere. Before this occurs, outsourced companies need to pro-actively evolve and consider alternative sponsorship categories that have been largely ignored in intercollegiate athletics as demonstrated by the research findings. This can alleviate departing sponsors due to the untapped revenue streams with new categories while also providing support in the escalating financial guarantees owed to schools.
3. In similar fashion, outsourced marketing companies need to continue to expand their inventory options in collaboration with the athletic department. As more options arise for corporate partners to spend their advertising dollars elsewhere, including professional sports, outsourced marketing companies need to be pro-active in offering new and exciting inventory and not remain stuck in the status quo option of radio commercials and permanent signage.
4. Along those lines, athletic departments who think they might not be able to afford new inventory items, particularly video boards and ribbon advertising, need to consider the option of letting an outsourced marketing company buy or finance the technology as they can earn a greater financial return on investment from the corporate partners with new capabilities.
While the arms race in intercollegiate athletics continues to press on and excessive spending in intercollegiate athletics is being criticized by detractors such as the Knight Commission (37), there exists the opportunity for compromise. As administrators in higher education begin to accept this belief as truth, Myles Brand, the former head of the NCAA, insisted that not all external involvement with intercollegiate athletics has been bad be it from alumni, supporters or corporate partners.
Brand (8) stressed that how you utilize the money contributed is of the greatest importance. He stressed that intercollegiate athletics focuses on opportunities for student-athletes namely in the means of scholarships and a quality education. It is not profit-driven like professional sports and owners of the teams. And funding for these scholarships and athletic department operating budgets can derive from corporate partnerships. The key is maintaining a clean fit for the corporate sponsor on the school itself and not just in the athletic setting (21). Outsourced marketing companies can play a vital role in these efforts through collaboration with their school’s mission thereby appeasing such groups as Faculty Athletic Representatives, the American Association of University Professors, the Drake Group, Coalition on Intercollegiate Athletics (COIA), the NCAA and others.
Commercialization is not a bad thing as it occurs all over campus and it frequently comes with initial resistance. Fans and faculty may not initially like the addition of sponsorships, but it does offset the budget for the athletic department without relying too heavily on the university for financial support. As faculty groups arise around the country to denounce athletics’ place in higher education (32-33), it is important to realize that the excessive spending in big-time intercollegiate athletics is the problem and not necessarily the commercialization as that is occurring everywhere on campus.
In examining outsourced marketing companies and their relationship to colleges and universities around the nation, evolutionary and creative thinking needs to occur more frequently. If the outsourced marketing company continues to think from the mindset of the institution of higher education and not purely as a sales group, future relationships will continue to prosper. It is when outsourced marketing companies lose that train of thought that problems start to arise. Ideally, greater communication and utilization of these findings and similar research will enable future relationship between the school, the athletic department and the outsourced marketing company to create a “win-win” situation for all parties involved. In turn, this can also extend over to better benefit the corporate partners for the duration of the partnership.
Limitations and Delimitations of the Study
A number of limitations existed in this study. The willingness of the surveyed general managers to participate and answer the questionnaire honestly, and to share detailed information about their specific marketing contracts and relationship. Another limitation is that some schools may have several outsourced companies overseeing their sales efforts. One company may handle sales for the radio and television while a second company may direct the sales for the athletic department’s signage at athletic facilities. A third may manage the sales for corporate hospitality and promotions. To address this concern, only schools with a single outsourced marketing partner were selected to participate in this study. In-house marketing and multi-sourcing efforts were not addressed.
Finally, as noted above, not all schools in the six major conferences have an outsourced marketing relationship thereby limiting the initial sample size. However, this was offset with the addition of 19 schools that are not in the six major conferences but have existing relationship with the major outsourced marketing companies. All participating respondents shared the characteristics that they are Division I in nature and have an exclusive outsourcing relationship with one of the leading outsourcing sports marketing firms.
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Christopher Saffici, Ed. D, Robert Pellegrino, DBA
Athletic programs at many colleges and universities are inconsistent with the school’s mission statements. The term “student-athlete” basically means that they are students first, and then athletes. We have reached a point here it can be argued that they are instead more athlete-students. Regardless of National Collegiate Athletic Association (NCAA) rules and regulations that stipulate that they are not allowed to, some student-athletes still receive preferential treatment and extra benefits while in college. Some recruited athletes are not prepared for the cascade of academic college work along with the additional demands that NCAA athletics require. The athletic pressures that accompany NCAA athletic scholarship can leave the unprepared student athlete with little time for academics. With collegiate athletics becoming a big business the rules associated with how we treat the student athlete must change. It is not unreasonable to suggest that is the business of college athletics changes then the way we treat the student athlete must change as well. Something needs to change in the way the NCAA conducts its business. Considering the large amount of revenue that is, and for the foreseeable future will be, generated each year in this industry, it is only fair that some sort of a stipend system be put in place to compensate student athletes.
Athletic programs at many colleges and universities are inconsistent with the school’s academic missions. The focus on maintaining a strong athletic program has taken precedence over the scholastic quality of the student-athlete that is accepted into the institution. For the student-athlete this can mean lowered academic admissions standards and preferential treatment in school. On the other hand, many student-athletes are attending college but not learning, and are being overworked and undercompensated (Ting 2009). Overall the issue here is about the big business that intercollegiate athletics has become versus the academic missions of the colleges and universities. The term “student-athlete” implies that the individuals should be students first, and then athletes. We have reached a point where it can be argued that they are instead more athlete-students. History/Background Athletic programs were first incorporated into institutions of higher learning for several reasons: it was believed that participation in sports helped to build character, it provided entertainment, and it generated positive school and community spirit. “It was also believed that athletics could contribute to the institutional mission through resource acquisition in the form of money, widespread visibility, increased student enrollment, and enhanced alumni support” (Gerdy, 2006, p. 46). However, it seems that ever since collegiate athletics began in the late 1800’s, there have been noted problems. In the first organized collegiate football game Rutgers University beat Princeton, but the team included three players that were failing a math class (Igel & Boland, 2010). Over time, the problem has grown: in the 1980’s 57 out of 106 Division IA institutions (54%) had to be censured, sanctioned, or put on probation for a major NCAA rules violation (Mandel, 2007). Fifty eight out of one hundred and fourteen did the same in the 1990’s (Friday, 2011). Because of the current state of most intercollegiate athletic departments, particularly those belonging to the NCAA Division I, colleges and universities have become more than just institutions of higher learning; they are now also huge players in the commercial entertainment industry (Clotfelter, 2010). Overall, many athletic programs have become something bigger than the school itself; without the program’s success the schools would not be as attractive to incoming students (Pope &Pope 2009). The success of these athletic programs lies in the hands of the student-athletes, and they need to be taught that success on the field does not always mean success in the classroom or in life. Athletics should be extracurricular to the academic priority (O’Toole, 2010). The Athlete-Student It is not a question of whether or not the experience for a student-athlete is different from that of a traditional student. Instead, the issue at hand here is whether or not student-athletes are students that participate in extracurricular competitive sports, or have become athletes that also go to classes whenever their athletic schedules allow. On one hand, it can be argued that the student-athlete benefits greatly from the relationship that he or she has with the athletic department and its stakeholders. On the other hand, many claim that the athletic departments have reached a point where they are unjustly exploiting
and overworking these athletes, using them to further grow their multimillion dollar corporations.
Some student-athletes still receive preferential treatment and extra benefits while in college in clear violation of the spirit of NCAA rules and regulations.. Colleges and universities routinely lower admission standards for athletes (Laderson, 2002) (Bracken, Scoggins & Weiner 2006). On average, student-athletes enter in the bottom 25% of their freshman class (Eitzen, 2000). They may even be promised “grades” to get them to attend a particular institution. (Lumpkin, 2008) Some might argue That such unethical behavior would not be necessary if student athletes were encouraged to hold their studies as their highest priority. Student-athletes also receive extra benefits in the form of money and gifts as rewards for attending a particular university or for a good game-time performance. Many athletes do not attend college to learn, but rather hope to use their collegiate competitive athletic experience to land positions on professional sports teams (Ladenson, 2002). They have a distorted idea of what it should mean to be a student-athlete, and believe it to be more like a required minor league that allows them to get enough exposure to someday make it to the major leagues. With the focus on athletic competition and away from academics, collegiate athletics has become simply one game after another, after another, devoid of a larger educational purpose or vision, just like professional sports (Gerdy, 2006). Recruited athletes are not prepared for college work, and then even more athletic demands than they are accustomed to, are placed upon them that allows little time for academics (Gerdy, 2006) (Ting 2009). Student-athletes entering their first year hold more responsibilities than the non-athletic participating student, and it may be more difficult for them to transition through changes in athletic participation demands on top of the new social and academic changes. McEwen (2010) conducted a study using a sample of eleven freshman female student-athletes that were interviewed at the beginning and then the middle of the season. He found that although all successfully adapted to their new social and athletic lives, only two of eleven (18.2%) were able to transition academically as well. Athletes spend 30-40 hours per week on their sport which is mentally and physically exhausting, allowing them little time or energy to put toward their studies. This is one of the reasons why coaches tend to require they take “easy” courses and “easy” majors so that they have a better chance of maintaining academic eligibility and can still compete (Eitzen, 2000) (Manzo 1994). By promoting an emphasis on athletics being more important than anything else in college, this also sends a poor message to the future college student-athletes, that athletics provide a “get rich quick avenue from the realities of hard work, personal sacrifice, and a commitment to excellence” (Haynes, 1990 PAGE NUMBER HERE!). This could not be further from the truth; however, as less than one out of ten thousand athletes make it into professional sports (Haynes, 1990). Collegiate athletics has been estimated to be a sixty billion dollar industry (McCormick & McCormick, 2006). It is interesting to note who benefits from this enormous amount of money. The big conference coaches are allowed agents and sign contracts that bring them hundreds of thousands to millions of dollars per year in salary alone. The NCAA and the universities benefit from the billions of dollars made and do not have to pay taxes on their earnings as they are claiming that athletic functions are in line with their academic missions. Corporations and the media benefit as they get business from the exposure at the athletic events. The student-athletes are the only group involved that are not able to benefit proportionally from the billions of dollars raked in each year. The NCAA claims that student-athletes are classified as such for a few very important reasons. First, athletes need to be able to claim amateur status. They do this by remaining academically in good standing and by also not receiving any pay or gifts for their performance or presence as a student-athlete. This way the NCAA can require them to perform work as athletes for free because it is considered part of the educational mission, which also means that they do not have to pay taxes on their profits (Eitzen, 2000). McCormick and McCormick (2006) claim that student-athletes at Division 1 NCAA sports at revenue generating schools are actually employee-athletes and they argue that they should be able to profit as well. The NCAA revealed that football players devote more than forty hours a week to practicing, playing, and training, but only twenty of those hours are mandatory. This means that putting in the extra hours is a well-known but non-documented requirement. Being required to participate in any work over forty hours a week is the equivalent to a full time job (Smith, 2011). Like no other industry in the U.S., the NCAA is allowed to employ one type of labor (athletic participation and performance) without paying a competitive wage for it (McCormick & McCormick, 2006). The student-athletes instead are provided with scholarships to attend school, which is a positive, but in comparison to the billions of dollars brought in every year, the tuition money is equivalent to payment in ‘peanuts.’ The student-athletes are being exploited economically, making millions for their institutions, the NCAA, and other corporations but are provided only with a subsistence wage or room, board, tuition and books.
The long hours that the student-athletes are required to put in are due to the athletic department’s attitudes of having to “win at all costs.” This can lead to heavily publicized athletic scandals of schools that will pay athletes in money or gifts to attend their schools, or grade changes in order to keep athletes academically eligible (Lumpkin 2008). Fans and stakeholders of big time programs would rather win and later get busted for cheating than finish 8-4 or 9-3 every year with a straight-laced program of student-athletes (Mandel, 2007). Discussions/Solutions Eitzen (2006) suggests some ways to correct the current state of intercollegiate athletics in order to align the departments with their respective institution’s academic missions. He suggests that institutions should no longer make admissions exceptions; eliminate freshman eligibility; provide remedial classes and training; reduce time demands; allow athletes the freedom to transfer schools whenever they would like; give them the right to consult with agents just like coaches are able to; and give them the right to make money from endorsements, speeches, etc. Smith (2011) suggests that all scholarship athletes should be able to receive a guaranteed undergraduate education including living expenses, for each year that they participate as an athlete on a varsity team, which they should be able to redeem at any time. This would allow them to focus on their sport if they choose to do so. At a certain point, taking the sport to the next level will either pan out or it will not, and at that time the offer should still be on the table for the athlete to complete their degree. The NCAA has been somewhat receptive to changes regarding the compensation of student athletes. A reform agenda has recently been passed by the NCAA’s Division I board of Directors that allows schools to increase aid and lengthen scholarship terms to individual athletes (Cohen 2011).
Collegiate athletics has become a big business, but athletes are expected to stay the same? How can they be expected to be responsible for contributing to the growth of a multibillion dollar industry but be the only party to not see any benefits from it (Toma & Kramer, 2009)? Balance needs to be maximized between academic and athletic programs. If we are going to refer to individuals as student-athletes then they should indeed be held to the highest standard of both student and athlete. Something needs to change in the process of how the NCAA conducts its business. The NCAA is going to have to admit that the requirements for a student-athlete, particularly in Division 1 revenue producing sports, are the equivalent of that of a full time job. Considering the huge amounts of money that are generated each year in this industry, it would only be fair if the student-athletes were all paid a monthly stipend for their participation. Focusing on the “athletic” aspect of being a student-athlete more than the “student” is unfair and will limit the experiences that the student-athlete should have while enrolled at the college or university of their choice. In order for the student to be well-rounded, programs must focus on the concepts of self-sufficiency, independence, and personal goal getting (Haynes, 1990). Almost all student-athletes will end up as a professional in something other than sports. It needs to be ensured that the students will succeed off the field as well as on the field (Smith, 2011). College is meant to prepare students for the real world. By failing to adequately prepare our student-athletes the institution also fails to serve this important function. The argument can be made that collegiate athletics overshadows academia at many schools. However, many feel that the whole university community benefits greatly from a very successful athletic program. Although preferential treatment may be given to certain student-athletes in order for them to be able to attend and complete an academic program and play for the athletic department, many believe it can be justified. It can be argued that many of these athletes would never make it in a higher education program if there were no sports programs to help them get there, and no motivation for them to try to attend. On a small scale, the university, directly the athletic department, benefits from the athletes because they help in growing the program and making it a success. A large number of the student-athletes benefit from the university because it provides them with a quality and aspect of life that they normally would not be able to experience. It is only a tiny minority that benefit from the institution preparing them for a future in professional sports.
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