In module six, we looked briefly at the role of sports agents who market the players and other personnel that they are representing as agents. But we also look at loyalty generally, and we concentrate on fans and loyalty programs, as well as how loyalty has expanded into the world of sports. Let's look at one of the most intriguing and some cases baffling topics in sports, loyalty. Why are fans loyal? One of the most common reasons a fan shows loyalty to a team is because they loved the team when they were kids. For many, it was a family experience. Children and parents routed together and they learned all about the team, and that kind of loyalty stays with the person as they grow up. This core loyalty can be hard for marketers, of course, as people move and remain loyal to the team from their previous city where the roots are. But childhood passion is not the only cause for loyalty. People like sports to escape from everyday life. Sports have winners and losers, and provide a new experience with each game, new hope and fear. It's a popular form of escapism. Let's leave this world behind and go somewhere else. Location play support. I'm here. I want to be involved. I invested in it and fun part of my community. The fan is in a town, and it's part of the loyal or experience in that town. Why else? Perhaps it provides an opportunity to socialize. Socializing over sports is a fun thing to do with friends or acquaintances, and give strangers an entry point for conversation. Another reason is knowledge. Perhaps you played a sport or have a deep understanding of that sport. Major League Baseball attracts a huge community of research and statistical enthusiasts. Of course, there's a fear of missing out. Any city with a team or a championship run will see the size of their bandwagon grow with each victory. You feel left out if you don't absolutely think about the team, and that's also part of being with friends and being with a whole group of people. So, it's the escape in the entertainment. Another ever-changing but historically constant draw to sports is gambling, be at college basketball brackets, fantasy football, or just side bets. The aspect of fan loyalty can become even more prevalent within game gambling. It changes how you look at a game short-term versus long-term. I also think that's stomach clenching, my team is going to lose, my team is going to win kind of nervousness that comes from carrying that strongly about it whether a team persevered, provides a needed adrenaline rush for a lot of people. So, let's also consider loyalty programs in general. Before we look at loyalty programs for sports, let's talk about loyalty programs as you think about them in a more general sense. Perhaps you belong to an airline loyalty program. What makes a good loyalty program? There are many responses to this. Good rewards, good prices, the timing of the rewards, the ease of redemption. Perhaps there's a family plan, so that you can take your kids to it. The reason loyalty programs exists is this scourge fan or customer defection. A hypothetical example of loyalty looks like this for me. I'm going down a highway, and there's a median in the middle of the highway, meaning that it's actually hard to get to the other side. I want to buy milk, which is a commodity, and I don't actually care who makes the milk. The prices generally are the same. I'm willing to cross the highway to buy the milk because I belonged to the loyalty program of the store across the highway. It's inconvenient to cross that highway, but I'm willing to do it because I belong to that loyalty program. I've known people who are willing to fly an extra trip in December to keep the status of their airline program, even though December might be a time when you'd want to stay home and be with your family, and that's because airline loyalty programs give you such value if you have status. When you think about loyalty programs, you think about having them because you want to discouraged defection, you want to win a greater share of your customer's wallet, you want to encourage additional purchases, and you want to use data. That's why loyalty programs exist. It gives companies a lot of data insights into their customer behavior and an opportunity to turn those insights into profit. Now, loyalty programs are not the same as many promotions. A promotion is something like BOGO, Buy One Get One free, or coupon for 25 percent off. The next time you go into a department store, you might get a bonus if you buy a certain brand name product. That's a promotion. A loyalty program is something much more sustainable, that you do over time, and you get a reward for giving your value to a particular place or a set of places. There's a difference between a promotion and a loyalty program, and we're going to look at loyalty programs as they relate to sports.
