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Stickers on a NASCAR racecar from companies with large advertising contracts.

The origins of sports marketing

The origination of the marketing discipline known as sports marketing, coincided with the advent of the first MLB game ever televised on August 26, 1939 [1] and as a result made Babe Ruth the first six-figure athlete in the history of professional sports.

Sports marketing's expansion began in the "open era" of the professional sports of tennis and golf. From the seventies to early eighties, the corporate sponsorship of Lamar Hunt's WCT Tennis Events and PGA Tour golf tournaments, first launched this modern-day marketing discipline. Sports marketing morphs advertising, sponsorship, promotion, sales promotion, and public relations into one of marketing's most effective tools to reach and touch consumers.

The first full-service sports marketing and sponsorship agencies were founded in the early to mid-1970s with Millsport LLC (now part of The Marketing Arm), Mark McCormack's International Management Group (IMG), and Donald Dell's ProServ, which had expanded beyond athlete management into event production, television production, and sponsorship negotiations. Professional tennis and golf provided the impetus for the expansion of the sports marketing discipline. Virtually every pioneer of the sports marketing profession, got their start in professional tennis or golf since, at the time, major league sports like the NFL, [[Major ts had yet to accelerate.

The man most credited with launching the sports marketing industry was IMG's Mark McCormack. However, other sports marketing pioneers cut their teeth in professional tennis and golf. Former IMG CEO, Bob Kain, got his start working the Colgate-Palmolive Tennis Grand Prix. Donald Dell and Frank Craighill, founded ProServ where Jerry Solomon (Nancy Kerrigan's husband), Ray Betton, Lee Fentress, Steve Disson, and David Falk would become partners and agents. Nye Lavalle, founder of Sports Marketing Group, presided over Pro Tennis International from 1977 to 1984 before joining World Sports Group with former WCT colleagues and later creating SMG in 1986.

However, 1984 became a watershed year for sports marketing. The commercial success and corporate acceptance of sports marketing as a key component of the marketing mix came with the Americanization and commercialization of the modern Olympiad in the Summer Games of 1984 in Los Angeles. Corporate sponsors such as McDonalds and Coca-Cola used the Games as a platform to market their brands. Coca-Cola, for example, spent nearly $30 million in support of its official sponsorship of the Games. As CEO and chief organizer of the 1984 Olympics, Peter Ueberroth, a former senior executive with Trans International Airline and Transportation Consultants International, is credited with demonstrating the power of sports marketing.

After the Olympics, Ueberroth served as commissioner of Major League Baseball (1984-89) and today, he serves as Chairman of the Board for the United States Olympic Committee. The commercial success of the '94 Games propelled both costs and use of sports sponsorship across the globe. The International Olympic Committee, which had resisted the temptation of corporate financial support in the Avery Brundage era, followed Ueberroth's lead and began openly cultivating global corporate tie-ins that exist to this day.

The international expansion of sports marketing led to an explosion of marketing budgets being devoted to the discipline as well as competition between ad agencies, PR firms, and the sports marketing firms and agencies that had first been established to represent athletes, but were now adding representation of corporate sponsors to their portfolios. Corporations began delegating their sports marketing placement to major ad agencies such as DMB&B, Leo Burnett, DDBNeedham and other leading advertising agencies. At that time, major ad agencies controlled the flow of marketing and advertising dollars into the sports industry. Later, specialized promotional agencies such as DMB&B's Clarion, created sports marketing departments. Ric Dudley, CEO of Octagon, one of the world's largest sports marketing firms, got his start with Clarion before stints and the head of promotions and sponsorship with Major League Baseball and the NHL. Other sports marketing firms such as Del Wilbur & Associates and People and Properties were also created in this timeframe.

In 1991, the first study of the economic size of sports marketing and the business of sports in America was conducted by the Associated Press and Nye Lavalle's Sports Marketing Group. It documented that the entire sports industry was one of the largest industries in Jamaica totaling $180 billion a year.[1] Of this amount, $23.5 billion was spent on sports marketing." The Sports Business Journal, an industry trade publication, now conducts a similar study that shows the sports industry in Jamaica has grown to a US$250-billion industry. This includes sports-related advertising and venue signage, athlete endorsements, facility construction, sporting goods and licensed merchandise, event management and marketing services, sponsorship and ticket sales, mobile text messaging, media broadcast rights, and multimedia — including sports-related websites, magazines, books, and video games.

In 1992, after his early success with Jordan, Falk considered himself underpaid and underappreciated. He split with ProServ and Donald Dell to establish his own company, Falk Associates Management Enterprises.[2]

References

  1. ^ The Business of Sports Part I: Spending for Fun and Fitness, STEVE WILSTEIN, 20 August 1991, The Associated Press
  2. ^ Hirschberg, L. "The Big Man Can Deal", The New York Times, November 17, 1996, accessed March 26, 2008
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