Visions in Leisure and Business Volume 16 Number 2 Article 3 1997 A Typology for the Understanding of Structure and Function of a Sports Industry: A Case Study of NASCAR Duarte Morris Bowling Green State University David L. Groves Bowling Green State University Follow this and additional works at: https://scholarworks.bgsu.edu/visions Recommended Citation Morris, Duarte and Groves, David L. (1997) "A Typology for the Understanding of Structure and Function of a Sports Industry: A Case Study of NASCAR," Visions in Leisure and Business: Vol. 16 : No. 2 , Article 3. Available at: https://scholarworks.bgsu.edu/visions/vol16/iss2/3 This Article is brought to you for free and open access by the Journals at ScholarWorks@BGSU. It has been accepted for inclusion in Visions in Leisure and Business by an authorized editor of ScholarWorks@BGSU. A TYPOLOGY FOR THE UNDERSTANDING OF STRUCTURE AND FUNCTION OF A SPORTS INDUSTRY: A CASE STUDY OF NASCAR DUARTE MORAIS, RESEARCH ASSIST ANT AND DR. DAVID L. GROVES, PROFESSOR DIVISION OF SPORT MANAGEMENT, RECREATION, AND TOURISM SCHOOL OF HEAL TH, PHYSICAL EDUCATION, AND RECREATION BOWLINGGREEN STATE UNIVERSITY BOWLING GREEN, OHIO 43403 ABSTRACT ness and how the business world relates to each sport (22, 87, 109). These relation­ Examination of sport from a molecular level ships are better understood in high visibility will help to increase understanding about the sports. nature of a sport. NASCAR (National Association of Stock Car Racing) is a In an effort to gain a better understanding of growing sport that has the potential to serve the relationship between business institu­ as a case study to understand the structure tions and a sport, it is necessary to develop and function of sport from a molecular typologies to analyze the relationships in a level. A framework was developed to ana­ comprehensive framework (25). This type lyze the relationships among the actors in of comprehensive framework is needed to NASCAR. help better define how to do business in the world of sport. The unit of analysis must be a specific sport industry (85, 116). There INTRODUCTION are significant structural and functional differences among the sport industries. Many of the segments of the sport industry Analysis must be from the bottom (molec­ are highly fragmented. Fragmentation has ular level) to the top (macro level). If a caused a lack of understanding of how sport wholistic approach is adopted, then all functions in relation to its super structure. sports industries are assumed similar. It has, The most important elements of the super however, been found through practical structure are economic developments. It is experience that the same principles do not important to segment each of the sport apply to all sports; therefore, the question is industries because each has peculiarities in "how are sports industries different?" ( 107, regard to its historical and evolutionary de­ 120). Because sport industries' differences velopment within the United States and have not been well understood, the international societies (80, 81 ). Most of segmentation principles have not been these relationships are governed by the successfully applied. This does not suggest world of business. It is critical to under­ that some major actors, such as international stand how sport relates to the world of busi- companies, do not cross lines of several 16 sports. There is a difference at the bottom try. Some of the companies that individual­ or molecular level. In order to build under­ ize their approach based upon structure and standing, analysis must begin with the function are Nike, Coca Cola, and specific sports industries and build toward McDonalds (83). The reason for using these the superstructure (84, 116). An example of examples is that these companies have the segmentation approach is when individu­ become icons in the global marketplace. It als who are in different regions of the is their sensitivity to the individualization United States or in different countries have processthat has made them more successful, to understand basic cultural and business especially in the international markets. It is patterns in order to effectively do business not a coincidence that these are three of the within a specific domain (91). One of the largest sponsors across a multiplicity of problems of some United States' ·business sports that have developed a connection to institutions has been that some business promote their product. A molecular ap­ professionals do not understand the global proach, therefore, holds some viability for business cultures (73). These individuals try initial exploration as a tool to increased to impose their cultural framework upon understanding. The companies that have other cultures. Those institutions that have been identified have only started to explore an understanding of the business cultures the nature of the structure and function and and the societal dimensions have been more use the information for "doing business on successful than the other business institu­ sport." tions that do not make a concerted effort to learn the specific business practices of a cul­ In an effort to understand its structure and ture. function, sport must be segmented by sport industries. It is in the molecular unit in A segmentation approach must be used to which understanding will develop because gain a better understanding of structure and these are the arenas in which business is function of sport in order to define the conducted and it is conducted differently by building blocks within a particular industry sport. A representative sport that is a (9, 84). The firststep in developing this ap­ developmental innovator, especially in terms proach is identifying the relationships of sponsorship, is stock car racing/NASCAR among the various institutional structures, as (16). NASCAR has been in the forefront of well as their function and identifying a sys­ knowing how to do business on sport and tem of classification to study the relation­ developing sponsors ( 6, 7). Their structure ships. This does not negate the superstruc­ and function is an i_ntegral part of the sport. ture of the particular industry; however, the In fact, NASCAR has th� highest loyalty primary focus of analysis must be on the ratings of sponsorship to fan product pur­ development of a typology in order to iden­ chases (72%). It is double other sports tify these inter and intra relationships (84, sponsorships (38%) when loyalty and prod­ 115). The secondary question is about su­ uct purchase is tracked ( 40, 83). perstructure and the relationships among the component members of the structure. This Motor sports are the most popular type of secondary question is the direct result of the sports in the United States when attendance primary analysis. is used as a measure (47, 68, 97, 108, 114). Demand is growing at a geometric rate with There are some companies that understand the development of new tracks and the in­ this particular approach to the sport indus- creased attendance based upon crQwd cap�c- 17 ity. Because of this demand and the open subsystems. It is the viewing of the issue nature of the structure, NASCAR makes an from a number of positions and different excellent example because the developmen­ types of data where perspective and tal cycles are related to dynamic changes in understanding are developed. Different the sport. It is a critical time in NASCAR's methodologies lend themselves to different development because the puristic establish­ disciplines and system perspectives to aid in ment of the sport is giving rise to a promo­ the synthesis process to develop better mod­ tional establishment. NASCAR is good els. This is an approach using a variety of business (90). This type of case study is methods to validate system understanding. excellent because it will allow the spectrum of any methodology to be tested due to the This study was conducted in two phases. change that is occurring in the sport. Diver­ Phase one was the isolation or development sity of change will allow the structure to be of typologies and comparative analysis us­ examined from a regional as well as a na­ ing contextual, historical, and content analy­ tional basis. Important events to a develop­ sis methodologies. In phase two, the ental time line are essential to the study to developed framework will be used to ana­ track the evaluation of any development of lyze the structure and functionof NASCAR. the sport (27). The basic method to be used in a follow-up study will be a cross-impact analysis (94, The purpose of this study is to examine 113). This is a method that examines the NASCAR as a representative sport to deter­ interdependence of significant variables. It mine a framework to analyze its structure examines both the magnitude and direction and function and how these elements influ­ of relationships among component elements. ence business processes within the sport. A matrix is constructed based upon The basic focus is the development of combinations of the relationships. Typolo­ typologies to examine important compo­ gies will be needed to construct the overall nents of structure and function so that matrix to identify basic structure and used as comprehensive models can be developed interpretive tools in data collecting. from the molecular level to gain a better understanding of sport and its relation to Three methods were used in Phase I to de­ business structure. velop a perspective on NASCAR and isolate a framework for analysis. A popular culture analysis was completed in order to under­ METHOD stand the nature of NASCAR from a developmental interest perspective. A his­ An eclectic methodological approach was torical analysis was completed to obtain a used. The basic focus is not the research perspective of the super structure and its ac­ methodologybut the issue and the use of the tors.