Pep Blanchart Fernandez BES La Salle -‐ Universitat Ramón Llull 1
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“Marketing professional sports clubs. Case study: Club Joventut de Badalona” Abstract Taking into consideration the main differences of the Sports Business Industry in the United States and Europe and analyzing both business models and structures of North American and Spanish Basketball’s professional leagues, this study aims to look for the best marketing practices and tools that are used in America in order to provide some feasible solutions that the Club Joventut de Badalona’s professional basketball club could apply successfully in their challenge of target and enhance fans to give more support the team on their delicate economical and institutional situation defined by a study realized by the combination of quantitative and qualitative data gathered from the actors that are involved around the club’s environment. Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 1 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” Contents 1. Acknowledgments 4 2. List of Tables and Figures 5 3. Executive Summary 7 4. Introduction 8 5. Literary review 8 5. 1 Overview and comparison of sports organizations in North America and Europe 8 5.2 North American and Spanish Basketball’s professional leagues business model and structures. 11 5.2.1 League Structure, Competition format and Barriers to entry 12 5.2.2 Competitiveness 13 5.2.2.1 The Salary Cap 13 5.2.2.2 Revenue Sharing 14 5.2.2.3 The NBA Draft 15 5.2.3 Young players and Basketball Development: The NCAA vs Junior teams 16 5.2.4 Revenue Source 17 5.2.5 Interaction with Fans 19 5.2.5.1 Initiatives and Events 19 5.2.5.2 Digitalization and Social Media 20 5.2.6 Summary Table 21 5.3 Marketing Sports in America: What Europe can learn 22 5.3.1 Defining Sports Marketing and its aspect 23 5.3.2 Procedures and successful Marketing Practices implemented in America 25 5.3.2.1 Case: Entering in a new market, the Brooklyn Nets 26 Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 2 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” 6. Methodology 28 6.1 Interview with Daniel Llurba, Marketing director of Club Joventut de Badalona 28 6.2 Joventut de Badalona fans survey 28 7. Case Study: Club Joventut de Badalona 30 7.1 Analysis of fans survey’s results 33 7.1.1 Demographics Questions 33 7.1.2 Habits 34 7.1.3 Satisfaction 35 7.1.4 Suggestion – Open questions 36 7.2 Challenges for the future 37 8. Recommendations based in the American Model, Suggestions and Proposal of Case’ Solutions 38 9. Conclusion 43 10. References 46 11. Appendix 49 Appendix 1: Other tables used during the study 49 Appendix 2: Example of Marketing Plans of NBA franchises and College teams 50 Appendix 3: Interview to Daniel Llurba, Marketing and communication responsable of Club Joventut de Badalona. (Full list of questions) 53 Appendix 4: Brief history of Club Joventut de Badalona 55 Appendix 5: All results of the survey 58 WORD COUNT: 11743 Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 3 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” 1. Acknowledgments First of all, I would like to thank all the professors and staff of BES La Salle that each one, had contribute on the a great education I could got here during these past four years and that I will remember for the rest of my life, the gave me the opportunity to spend such a great time in my exchange program at the Christian Brothers University in Memphis and the opportunity to live such a great experience by participating in the National Model United Nations in New York City on March 2013. I can’t imagine any other university where I could have fun as much as I did here in La Salle. I would like to give a special mention to first, Isabel Oller, which suggest me to accept the challenge to make my studies in English that I am very proud to be abled to accomplish it. Here in La Salle, not only I learned a career but also I learned a new language. Also mention Olga, that has been patient with us, all these years and made much more easier our days in La Salle. The thesis-writing process would be much more difficult without my advisor, Chris Kennett, which suggest me how to focus and address the topic and the whole work and gave me all the facilities to find out all the data I was needed during all the process. At the beginning I was little bit afraid because I didn’t know how to make my thesis, but you and Kerem, help me to settle down and be confidence on the work I was doing. My work would not be possible without the collaboration and provision of Daniel Llurba, Marketing and Communication director of Club Joventut de Badalona, who gave me a little bit of his time to receive me to interview him without no pressure and to give me all facilities to be able to respond the surveys to the fans at the game. – Gràcies i força Penya! To my friends, Ferran Pellicer, Marc Valera and Marc Giné, that threatened not to let me to go on vacation with them to L’Escala, if I did not work hard on my thesis during summer. They gave me an effective reason to keep striving and working. And the last, but probably the most important thank goes to my family, which made all the efforts they could to ensure and provide me such a great education I could receive here in La Salle. Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 4 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” 2. List of tables and Graphics List of Graphics Graphic 1: The Organizational of Sport in Europe: The Pyramid Model” 10 Graphic 2. “Richest Sport leagues worldwide” (2011) Estimated Revenues US$ (bn)) 11 Graph 3. Joventut de Badalona’s funding source 30 Graph 4: Age Distribution 33 Graph 5: Relation with the club 33 Graph 6: Frequency of attendance 34 Graph 7: Who do fans go at games with 35 Graph 8: Methods to attend games 35 List of Tables Table 1: Comparison Economical Results NBA and ACB (2010-2011) 17 Table 2: ACB Games attendance (2012) 49 Table 3: Actual Media Contracts NBA 49 Table 4. Social Media Stats Comparison - Leagues (June 2013) 20 Table 5. Social Media Stats Comparison – Last Champion teams each league (September 2013) 21 Table 6: Similarities and main Differences between the ACB and the NBA 21 Table 7: Segmentation of Sports’ Consumers 25 Table 8: Los Angeles Clippers Marketing Plan for Season 2012-2013 50 Table 9: University of Memphis Tigers Basketball, Marketing plan for season 2002-2003 50 Table 10: LOYOLA University, Marketing plan for 2004-2005 campaign 51 Table 11: University of Seattle, Marketing plan for 2009 – 2010 season 51 Table 12: Brooklyn Nets’ Experiences 51 Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 5 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” Table 13: Satisfaction grades (Percentage of answers/total responded) 36 Table 14: Examples of thematic days Joventut de Badalona 40 Table 15: Sharing experience through Social Media: 42 Table 16: ACB and NBA Strong and Weak points’ comparison 43 Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 6 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” 3. Executive Summary Since the beginning of professionalization of sport, America and Europe have followed two different models in the way of structuring and managing sport. Recently, and by the consequences of the global economical crisis that impacted on our society, the deficiencies and weaknesses that presented both models accentuated and put at risk the stability and efficiency of the models. A new trend of reinventing the sports business model is generating lots of possibilities but relatively little research has been conducted on the characteristics of the US and European models. Through the study of the main aspects of North American and European Sports business models and structures, and by focusing on both main basketball leagues, the NBA and the Spanish’s ACB, this research aims to identify a new, sustainable sport business model for professional basketball. The second part of the study, a practical case study of Club Joventut de Badalona will be presented. Following the same structure of the first part of the study, an analysis of the main factors and aspects, involving the marketing of sport and by exposing a set of practices that different North American basketball teams conducted, a marketing plan proposal will be defined and explained in order to solve the challenges found by researching on the club’s current crisis situation. This research is informed by an interview of the marketing director of the club, Mr Daniel Llurba, and by the elaboration, and posterior results analysis, of a survey administered to the fans while they were attending to a basketball game in the Palau Olímpic de Badalona, home court of the basketball club. Pep Blanchart Fernandez BES La Salle - Universitat Ramón Llull 7 “Marketing professional sports clubs. Case study: Club Joventut de Badalona” 4. Introduction The study will firstly seek to address the main differences between how sport is organized in North American and Europe, identifying strengths and weaknesses in both models. Further, the review will focus on the National Basketball Association (NBA) and Asociación de Clubs de Baloncesto (ACB), responsible for the organization of the Spanish championship.