Ethics and Integrity in Sports Marketing

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Ethics and Integrity in Sports Marketing

• Presented by
• Dan Migala
• Publisher, The Migala Report

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Daily ethics choices

• Idea generation
• Ticket sales
• Sponsorship sales
• Renewals
• Customer service
• Management

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Road map to better ethics

• Strive to be successful not a success
• Revenue is a result, not an objective
• Pillow talk
• Hire standards
• Truth in advertising
• True test

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Success VS. Successful

• Aim to be successful and not a success
• Success The desire is to reach the goal at
  all costs and without boundaries
• Successful Focus entirely on the effort and
  the process required and success is the result

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Success vs. Successful

• Examples of success
• Rafael Palmeiro, Sammy Sosa
• Examples of successful
• Gatorade  Major League Baseball
•   Dallas Stars
• Chicago White Sox

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Revenue is a result, not an objective
-Gatorade motto
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Revenue is the result

• Gatorade revenues
• 1985 100 million
• 2005 3 billion

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Revenue is the result

• Revenue growth can be attributed not to an
  increased emphasis on revenues but by staying
  true to the integrity of the brand at its core.

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Revenue is the result

• Theres a smarter way to grow a business than to
  just focus on dollars and cents. The integrity of
  the brand is what allowed us to do what we do and
  it gets our staff emotionally involved and that
  really makes us different and we want to figure
  out ways to enhance what is unique about us.
• -Tom Fox, SVP Sports Marketing, Gatorade

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Revenue is the result

• Not just walk the walk but talk the talk
• Gatorade Slurpee
• You can chase any opportunity all day long but
  what you need mission and values that you can
  stand for. You have to build your business with
  revenue as a result and not as an objective and
  pursuing a Gatorade Slurpee that would generate a
  ton of money would be compromising our value
  system.
• -Tom Fox, SVP Sports Marketing, Gatorade

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A word from a sponsor

• I was recently seriously considering a mid-six
  figure sponsorship package with a team but I told
  the team executive I needed a little more time
  before I made my decision. He verbally hinted to
  me that if I hurried my decision that he would
  make it worth my while and wrote down a
  five-figure cash figure on a piece of paper and
  said that would be mine personally if I sped this
  along. I was being bribed. I kicked him out of my
  office and have since wondered how he sleeps at
  night and sadly it has forced me to not trust
  other team executives that come into my office.

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Pillow test

• Major League Baseball sponsorship executives can
  sleep at night because of their departments
  pillow test.

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Pillow talk

• You have one shot at integrity and cant sway
  from it. If my head can hit the pillow at the end
  of the day with a clear conscience then Ive done
  my job. Its not easy to do but 100 percent
  disclosure is required. Anything you do that
  would make you nervous is bad because you have to
  sleep at night.
• - John Brody, MLB SVP Corporate Sales

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Pillow test

• MasterCard sponsorship
• Memorable Moments campaign
• Potential work stoppage
• Millions of dollars on the line
• Full disclosure

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Pillow talk

• I learned from this experience that you are
  going to get what you deserve. If you are
  dishonest with a sponsor, you are only lying to
  yourself and you will be discovered either
  internally or externally and get what you
  deserve. People in sports marketing that are
  honest deserve to ascend and that is what is
  going to play out in the long-every time. Its
  not always the easiest road to take but it is the
  right road.
• - John Brody, MLB SVP Corporate Sales

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Hire standards

• I discovered that my top sales person has being
  doing side deals for his own benefit and telling
  clients what they wanted to hear in lieu of the
  truth for several years. This includes trading
  out services for his personal use. It is a tough
  situation for my club because he was well liked
  and brought in significant revenue but we had to
  let him go and lost some business as a result but
  my staff and our clients has something more
  valuable and that is respect for us.

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Hire standards

• Dallas Stars
• Hire people looking for a career in sports and
  not just a job in sports.
• Discussing ethical dilemmas in meetings
• Can sales people handle their own achievements?

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Hire standards

• The difference is those seeking a career in this
  industry will be more committed to the long-term
  than those just looking for a job. These people
  are your ambassadors and it is critical they see
  the long-term and are truthful people. It all
  comes down to hiring people whose personal core
  values line up with yours. At some point theyll
  crash and burn and sell someone a lie and not
  prostitute themselves.
• - Jim Lites, President, Dallas Stars

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Hire Standards

• Discussing ethical dilemmas
• Stars hold meetings to discuss ethics
• Tested during lockout with fan/sponsor
  communication
• Had to face hard truths to customers and be
  honest with them
• Result Highest renewal rate in NHL post lockout

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Hire Standards

• Can your sales people handle their own
  achievements?
• For many people, ethics go out the window once
  you start running a department because you are
  not accountable for ethics and greed dominates
  them and how truthful you are really becomes an
  issue of how prepared you are to handle success.
• - Jim Lites, President, Dallas Stars

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Truth in Advertising

• Slogans
• The Worlds Best Fans
• Good guys wear black.
• Brand messages
• Baseballtown USA
• Win. Or Die Tryin

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Truth in Advertising

• Chicago White Sox
• They created a campaign that truthfully matches
  the teams character and is not just an image
  designed to sell tickets.
• Result is they dont have to re-invent the
  teams image annually or try to cover up the
  reality that it is a campaign created to have the
  public see the team for what the team wants to be
  seen as instead of what it really is.

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Truth in advertising

• To build a long-term strategy, you have to tell
  it straight to the fans and thats what we are
  doing and will continue to do. If you keep
  reinventing the brand every year with catchy
  slogans then fans will see right through it and
  become immune to trusting you. Its all a core of
  strengthening our vision by staying rooted in who
  we are and not just what a marketing campaign
  wishes us to be.
• -Brooks Boyer, Vice President of Marketing,
  White Sox.

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Truth in advertising

• Tactics
• Two x Four Agency (chicago)
• Discussed team identity with players and
  coaches
• Discussed team identity with fans
• Discussed team identity with opponents
• Result Win. Or Die Tryin Campaign.

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True test

• My owner publicly shows integrity and character
  and expects the same of us. Privately, he has a
  get it done attitude and has even encouraged us
  to fudge our attendance segments to close a deal.
  I dont feel at all comfortable doing this
  because it is wrong and lying but I have to
  protect my job and struggle with these
  situations.

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True test

• Whether you know it or not, sponsors do test you
  for the truth.
• Request for packets from different brands
• Will the property say no to anything?
• Does the property answer every question I ask
  on the spot?
• Call other sponsors
• What was the worst sponsor relationship youve
  ever had?

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From one of you

• I have always believed that if you are
  completely honest with your clients they will
  always respect you. Conversely, there have been
  times when potential clients have, through the
  years, suggested "side" deals that would have
  "benefited" me or that person or his / her
  company in an unofficial capacity. While I always
  declined, to this day I still remember those
  individuals and hold a total lack of respect for
  them. While there is tremendous pressure to get
  the deal done or closed, one's personal and
  professional character should NEVER be
  comprimised. Our reputations are based on such
  character or lack thereof. This business of
  sports marketing that we are in is both gigantic
  yet at the same time in many ways very small. It
  is large in its size but quite small within its
  private walls. The inner truths that are
  discretely communicated are often the final word
  regarding our opinions of a peer or associate.
  Opportunities are often given or denied due to
  those said opinions. The bottom line is that
  if we are forthright with our clients, we'll last
  a lot longer in this business and more important,
  be able to sleep a lot better at night.

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What now?

• Take your focus off of revenue. Grab a Gatorade,
  hit the pillow, hold a meeting to discuss ethics
  with your staff owner, set boundaries for
  yourself and your marketing opportunities and
  the result is you will become successful.

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For a copy of this speech, please contact Dan
Migala Publisher The Migala Report 312-602-431
5 dan_at_migalareport.com

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