The Strategic Sports Marketing Process Report

““G-Cell””

Shannon Flaherty, Juan Lluveres, Sarah Nealon, Gina Tomei

11/28/2012

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EXECUTIVE SUMMARY

Spalding, under Russell Athletics, needs to revamp its image within the sports product

world. With the introduction of the “G-Cell”, we are hoping to reach to new and existing markets

to revive the Spalding brand. Although Spalding basketballs are used within the National

Basketball Association, everyday consumers need to also purchase this product.

Our initial plan is to create a basketball that will have a longer lifespan than the original

Spalding basketball by introducing the “G-Cell”, with details described within this Strategic

Sports Marketing Process Report.

We feel as if this product will be a hit and beneficial to the basketball market. We have

examined every detail regarding this product and implementation.

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INTRODUCTION

Our company is Spalding which was established by Boston Red Stockings pitcher A.G.

Spalding in 1876. Spalding aimed towards being the best, being at the top, and wanting others to

be like him. From the creation of the first basketball to latest one Spalding's company carries a

tradition of innovation. Spalding's first creation ever was the Major League Baseball in 1876.

Following the baseball were the baseball glove, the football, the volleyball, the baseball bat, the

golf ball, and last but surely not least the basketball. Known for their high quality and

performance guarantee many professional as well as collegiate teams use Spalding. As time as

moved on and with the technology we have today Spalding has been able to enhance its products

and continue to have consumer loyalty. Some partners Spalding is associated with are the

NCAA, NBA, USA Volleyball, etc. Spalding is the largest basketball equipment supplier in the

world, and America’s first baseball company. Internationally Spalding has served over 90

countries Worldwide for over 35 years.

Spalding is the official basketball of the National Basketball Association (NBA) and

Women’s National Basketball Association (WNBA), the official backboard of the NBA and

NCAA, the official baseball of the Little League World Series, the official volleyball of the King

of the Beach Volleyball Tour and the official football of Pop Warner. As well as being the top

producer and marketer of basketballs, footballs, volleyballs and soccer balls, Spalding produces

softballs under the Dudley brand. For over 130 years Spalding has been at the top for innovation

and quality.

Product

Our product is a basketball that has a gel lining inside of the leather to protect the

basketball from losing air as well as give the ball extra support inside. The basketball would

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continue to standard size one for the NBA and one for the WNBA. We decided to call the

basketball the “G-Cell”. We would produce and indoor basketball as well as an outdoor one. We

figured we would choose Spalding as our company to produce a product from because they have

definitely been the leading sporting goods company with high quality products. Spalding has

produced a number of different basketballs which all have been highly successful in the NBA

and in the WNBA.

The ball structure would be very much like other basketballs Spalding has produced, just

with the exception of the gel lining inside which would help prevent air loss, as well as being

very durable. For instance if a person were to try and pop the ball the gel lining inside would

actually flex with the pressure that it is in taking. An example would be like when a hockey

player takes a slap shot and the stick bends "flex" and then goes right back in place after the shot.

So when someone dribbles the ball it would be the same reaction. It could possibly give the ball

more of a grip.

Brand Equity

In regards to brand equity we want our consumers to believe that our product has a high

level of brand equity which it does. By having this customers will be satisfied with our brand as

well the product we are getting them to buy. Satisfied customers will hopefully be loyal

customers (repeat purchasers). Knowing that our product is meeting the needs and wants of our

customers is highly beneficial. Of course we would like to attract new customers as well to our

product. People who are already familiar with Spalding know that our main objective is to have

high quality products as well as be innovators. We want customers to remember our brand and

product. I want someone to say "have you tried the new Spalding basketball the “G-Cell”...I love

it you should get it". The way we present this product to customers is definitely an important

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factor. The image will stick in customer's minds if we make it really appealing to them. We

would have to invest in commercials and advertisements to get our image out there. The image

Spalding is trying to portray is that "We are about being 1st and being the best". This would have

customers who use our products feel as if they are number 1 and are the best. You should feel top

quality if you are using a top quality product.

Brand Image

Regarding brand image we can incorporate athletes in our advertisements and

commercials. When a customer can relate to their favorite athlete it attracts them more to

purchase a product. For instance if a little kid saw LeBron James shooting, dribbling, and doing

crazy tricks with the “G-Cell” basketball he/she would want to have that basketball as well. Of

course the child would persuade mom/dad to go out and get the basketball because it's the best

and coolest ball out there. We want to establish a positive image for our sporting organization.

ORGANIZATIONAL VISION/ MISSION/ CULTURE

What are the organizations vision/ mission/ culture? I would say the mission is "From the

beginning it was all about being first, being the best...being what others could only aspire to be".

Spalding is all about tradition and from being the leading sporting goods industry I would say

they live up to their word. I want our employees to be motivated to create new ideas and give

customers a clear straight forward answer about what our company expects. The vision for

Spalding is to continue to be the leader in innovation and quality. Having the technology we

have in this generation allows Spalding to live up to those standards they set for themselves.

Eventually in the near future we would like to expand the “G-Cell” to other sport products

(Footballs and volleyballs). As for culture of the Spalding family I would say that it is just to

keep the tradition it has always had and continue to be successful with it. We want to continue to

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serve the customers we currently have with our high quality products and draw in new customers

as well.

With the basketball the “G-Cell” we want people to feel and know that they have the

world's greatest basketball. You want people to feel that if LeBron James has the “G-Cell” then it

is a must have basketball. With every shot and dribble of the “G-Cell” you want people to feel a

difference. It is not necessarily the texture of the ball you want people to feel since the gel lining

is on the inside, but rather how when then dribble, hold the ball, and put pressure on the ball they

can feel the flex of it.

ORGANIZATIONAL GOALS

Feeding off our vision and mission our goal is to implement our words into actions. Our

products goal is measurable and I would say has its challenges, but it is attainable and time

specific. Within our organization we want our employees to express ideas and any other insights

they have towards this specific product and future products from Spalding. Having employees

involved in making goals and creating ideas helps with commitment, and people working

together to create something great. As it pertains to the product the “G-Cell” I want customers to

feel and know they have the best basketball in the world in their hands.

We have to keep in mind our long-term economic, environmental, and social aspects in

our business strategies while making sure we continue to maintain global competitiveness and

brand equity. Of course our main goal is to make profit off of this product, but we have to keep

in mind our customer loyalty by investing in customer relationship management, and product and

service innovation that focuses on technologies and systems.

MARKET ASSESSMENT

Primary and Secondary Market Research

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Our Primary Data is observed or collected directly from first-hand experience.

Secondary Data is published data and data collected in the past. Our Secondary Data can be

found within our organization (internal) or from outside sources (external).

People who are familiar with basketballs we would want to test out our product because

they can give us better insight on the product. We can sample our product with pro athletes, and

outsiders ranging from the ages of 8-30 years old. We can get their opinion on whether or not

they feel a difference when they shoot and or dribble. Outside sources can maybe even gives us

ideas on whether to change the outside design just a little to give the “G-Cell” more of kick. Also

within our organization we can go through past data on the evolution of our Spalding basketballs

and see how our sales did and customer reviews.

Overall, we need to know where we been, but not focus too much on it. If we had any

past faults we still need to make sure we do not bring them again. We need to know where we

currently stand, and since Spalding is the leading sports good producer I would say we are

currently successful and have achieved a strong foundation. Last but not least probably one of

the most important aspects is where are we going! We have been successful for over 130 years

and we can continue to keep this tradition. With the technology we have will continue to create

and produce the world's greatest sporting good products.

SWOT / PEST Analysis

Our strengths are we are the world's leading sporting goods producers. We have created

strong relationships with the partners we have and we do have loyal customers who continue to

buy our products. Our organization can prove that our products are of high quality. Our

weakness with the product can possibly be that it is an expensive basketball and will people be

willing to pay that much for a basketball. Also when a new product comes out you have loyal

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customers who buy all your products as soon as they come, but then you have people who are

skeptical about buying a product and will wait to hear and see what other people say about it. As

for getting new customers we would have to keep in mind how are we going to attract them to

purchase our product.

Opportunities we can have are creating a new successful product that people want to

have. Also, we can possibly open up to new customers. We always want to satisfy the customers

we have to we can continue to have brand loyalty and good organization customer relationship.

Threats would be competition. Do we have competitors with a similar product out there? Based

on research we would be the only basketball company with the gel lining inside a basketball.

Methodology

The method we are going to use to implement our task at hand is quite simple. We know

our mission and vision so we have that down packed. We know the product we want to introduce

to our market, and the question is how are we going to do this? As stated earlier we are focusing

on people from the ages of 8-30 years old. What we need to do is figure out how we are going to

appeal to each audience. A key factor in this as I said earlier is getting a star athlete to help

commercialize the product. Children for the most part idolize a certain athlete and want to be like

them and have what they have. As for teenagers you can stress the same method as well as

explain how the basketball is highly enhanced. For adults I would lean more towards explaining

how advanced and technological the basketball is. We need to know how we are going to

financially carry out this product which will later be discussed with pricing.

Results / Analysis

By dividing the process of getting this product out there in the world would be the most

beneficial to our organization. We could divide into teams consisting of: financial (costs), the

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making of the product itself, commercialization and advertisements, and a target market team.

On behalf of Spalding I know where our company stands in the sporting goods industry; so I am

highly confident that we will be successful with the “G-Cell”

Complete Competitive Analysis direct and indirect

Since Spalding is the ball used by the NBA and WNBA we would not have an issue with

competitors in this aspect. The place where I would raise some concern is that players may not

want to use the “G-Cell” even though the outside is exactly the same with just a few kinks in

design. So the competition we might actually face could be internal from other basketballs we

produce. In regards to customers they might lean towards a less expensive brand for a basketball.

MARKET SELECTION DECISIONS

Throughout this planning phase of the market, decisions are being made by the company

that will then determine the direction of the marketing mix. The decisions being made in this

portion is what consumers are we grouping together in order to achieve common needs amongst

all, who are we marketing towards, and how we want our product to be displayed throughout the

marketplace. Another way to describe these three market selection decisions is segmentation,

targeting and positioning.

Segmentation

In order to select a target market for the “G-Cell” there were many things that we had to

take in consideration to gain the most revenue and exposure of our product. The “G-Cell”, is a

basketball product meaning that it is very important that we as producers are able to target the

product to the most need based consumer segment. Segmentation is defined as identifying groups

of consumers based on their common needs (Shank 165). There are several different markets that

we had taken into account through segmentation to do this. The different markets that we had

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segmented for the product are age, gender, ethnic background, psychographic, behavioral, and

benefits. These are the main market segmentations that we had chosen to make the “G-Cell”, a

wonderful product to the consumers.

Age

Age is one of the most effective and easiest variables in order to segment a market. The

“G-Cell”, would break up the age demographics into possible markets in order to market all

different ages. The ages of the consumers would range children from 8-12year olds, teens aging

13- 20 year olds, and young adults ranging from 21- 30 year olds. This age demographic range

targets all different age markets but still having all the same common needs of the consumer.

Each consumer will be at different life stages in their life.

Children

The children life stage will be a successful component because there has been a great

understanding between children and sports. They want to get involved in sports at a young age

and many parents encourage this meaning that they will need sports products such as the “G-

Cell”. Children ages eight to twelve years old have a great influence on purchasing decisions.

According to Shank, approximately eight percent of all sports equipment is purchased by

children while ten percent of all sports equipment purchases are being influenced by children

(167). Children are the future investors of sports products that is why as sport marketers we need

to reach out to them. Children will become loyal to the brand Spalding and in itself the Spalding

product “G-Cell”.

Teens

Teens are a very large demographic throughout the United States. Teens ranging from

thirteen to twenty years of age are very loyal to certain brands. We have chosen Spalding out of

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any other brand for our basketball product because it is such a well- known brand throughout the

sport of basketball. Teens are very physically active and involved in sports so they will need

sports products to help them better their game. Teens have a very vast purchasing power

meaning that when new products come out that are better than the last one they will want to

purchase the top of the line product such as the “G-Cell”, because it is so innovated.

Young Adults

Targeting young adults ages twenty- one to thirty can be very difficult. They want the top

of the line products and are very loyal to brands. When the new “G-Cell”, product is released

they will be able to see how innovative this product is with the gel on the inside and will be loyal

to the brand Spalding because it is so well known. Young adults also have a very large

purchasing power. Some young adults may purchase this basketball for themselves or for others

as gifts.

Gender

Consumers of the “G-Cell”, are not gender biased. This product will be both available to

men and women for a greater purchasing power and needs based. In this day and age many more

women are participating in sports. Therefore, many men and women throughout the United

States will need to purchase sports products. According to Shank, the senior director of the NBA

global merchandising group, Lisa Piken, women could represent $100 million in sales in 2006

(174). Being that it is six years later, this number has risen causing more of a purchasing power

for women. However, men are the highest consumers of basketball products.

Ethnic Background

Our product, “G-Cell”, will be segmenting the markets based on race of their consumers.

African Americans and Caucasians represent the majority of the basketball market. In a 2010

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study of the NCAA men’s basketball of all three divisions shows that 45.6% were black while

46.7% were white. These percentages show how only 7.7% were made up of other racial

identities that were playing basketball at the collegiate level. Along with this African Americans

accounted for 78% percent of NBA players in 2012. The “G-Cell”, will appeal to these racial

identities because of its innovations.

Psychographic

Psychographic segmentation will help group consumers on common lifestyle practices

and their personality. This type of segmentation will help us appeal to our consumers by finding

out what they enjoy about the sport of basketball. We will be able to advertise to them in such a

way that they will not be able to by any other type of Spalding basketball. We plan to advertise

through television, magazines, internet and through communication with others. This will help

broaden to make the product well- known through all walks of life in the most efficient way

possible.

Behavioral

To have our consumers loyal to a product we will segment them through behavioral

segmentation. Brand loyalty is a way in which many individuals purchase products in today’s

society. People will talk to one another and find out how great the Spalding products are and they

will not want to use any other type of basketball product. Once consumers purchase one product

they will continue on purchasing the same products from that brand.

Benefits

The product must appeal to a group of consumers through benefits segmentation.

Consumers will purchase this product because of all the great innovations that are behind it. The

“G- Cell,” has an inside lining with gel of the leather basketball to protect it from air getting out

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over time. This is a very big benefit for the consumer because they will not have to purchase so

many basketballs throughout the year. They will be able to have an all season basketball

withstanding all types of weather conditions. This basketball product purchase to the consumers

will satisfy their needs.

Target Marketing

The target market of the Spalding product, “G-Cell”, is targeted towards teens, ages

thirteen to twenty years of age. This includes both females and males that are being targeted.

Teens are a very large group of consumers with a vast buying power. This market will be geared

towards athletic individuals who enjoy physical activity. The “G-Cell”, can be used during

practices, games or playing just for fun. This market will most likely purchase the “G-Cell”,

because they are the age demographic that is most in their physical years. The teens purchasing

this ball may play for their middle school, high school, rec leagues, travel teams, and even in

college. Teens will need to purchase balls for their sporting events. They will want the top of the

line products in order to help them. Teens are very loyal to their brands of their favorite products

so being that the “G-Cell”, is a Spalding product they will purchase it because it is more

advanced than the regular basketball causing less air to come out.

Teens ranging from thirteen to twenty years of age are a very reachable market. They are

all advanced in technology. We can market the “G-Cell”, in many ways. One way that we can

market to them is through the use of the internet. We can put up advertisements so when they go

on a website they will be able to see the product. Also we can market through television

commercials. In this day and age many individuals watch television for more hours than the

recommended amount. Sports magazines will also reach out to the teens through advertisements

of the “G-Cell”. Teens are all very social meaning that if one person tells them about a product

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they just purchased them will want to go out and purchase the same thing because many at this

stage in their life want to be the same. Teens are the best target market for our sports product.

Positioning

Spalding, “G-Cell”, has been ways that it can better position itself amongst other

competitors such as Nike. This basketball will be named the number one selling basketball in the

market at the time. If consumers know this they will be more willing to purchase this basketball

because they will know that they are getting something that everyone needs. Our target market

will fall into this because they are teens. They will think that I need a new basketball and the

Spalding “G-Cell”, has a gel lining in the inside that will make the ball last for a longer period of

time. Spalding has been known for its basketball products and has been a well- known name in

this market. Many people are loyal to this brand already which will put the “G-Cell”, in a better

market to be sold. The value of this product is also very good. Compared to competitors the

Spalding, “G-Cell”, basketball has a longer lifetime guarantee than any other basketball. No

other basketball has a gel lining and this is what makes this basketball stand out from

competitors. This product also has a one year guarantee for the consumers.

SMART OBJECTIVE

SMART is an acronym for Specific, Measurable, Attainable, Realistic, and Time Bound.

An example of a SMART objective is “To increase drink sales by 6% over the next two years”.

Our SMART objective is to sell 40,000 “G-Cell” basketballs at $65.99 within one year to earn

overall revenue of $2,639,600. A goal that is SMART has a higher chance of actually happening.

Specific

To create a specific objective, our company will look at its needs and wants. Our

company, Spalding, and our parent company, Russell Athletics, are involved as well as our

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retailers such as Dick’s Sporting Goods, Modell’s, Sports Authority, and Walmart. We know our

target market and how we want to market to them specifically. It also helps that we have a set

price, amount we want to sell, and what time span. Recognition of our goals will put us at a

better spot than our competition and hopefully increase our bottom line.

Measurable

Our measurable goal is to attain a profit by selling 40,000 “G-Cell” basketballs within

one year.

Attainable

The way that we will be able to reach our goal is by selling 40,000 basketballs within one

year to reach a sales amount of $2,639,600. This is definitely attainable due to the fact that over

250,000 basketballs are sold in the United States each year. Spalding and Russell Athletics can

handle this. They are established firms with manufacturing plants. The only different part of the

basketball is adding the gel to the inside, which is very much attainable for the two brands. With

our marketing and endorsements our goal of 40,000 within one year is not a problem.

Realistic

Realistic ties into attainable. As previously mentioned, over 250,000 basketballs are sold

within the United States each year. Our goal of 40,000 is roughly 16% of the overall sales. With

new technology and the fact that the ball lasts longer than your average basketball, we feel that

this goal is realistic. To ensure this goal to be realistic, we can also evaluate our SWOT analysis.

Time Bound

Our goal is time bound. We have set the goal for one year so far.

MARKETING MIX DECISIONS

Product

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The “G-Cell”, is a basketball meaning that the ball is a sphere in shape and can be

inflated. This is a basketball that has gel lining inside of the leather to protect the ball from losing

air. This ball will still have the normal make up of a basketball but with an added bonus.

Basketballs have a covering and inside that covering is a rubber bladder that holds the air. With

this gel, it will be much more durable and reliable then the previously used basketballs. As a

consumer you will also be able to have this product for a longer period of time because the gel

protects the ball from losing air at a rapid pace. This sporting goods product is produced through

the well-known sporting goods brand, Spalding. The “G-Cell”, ball will be the color orange

because this is the regulation color for basketball games. In circumference the basketball will be

29.0 inches and will weight 20 ounces so that this is a universal ball for a range of ages and both

genders. The “G-Cell”, must be inflated enough that the pressure of the ball will make a rebound

to a height of 50 in which is measured at the top of the ball when it is dropped on a wooden floor

from a height of six feet to make the ball legal. Basketball is a very common sport throughout the

United States. Whether it be with children, teens, and young adults the “G-Cell”, will appeal to

all and both men and women. Men and women will be able to play games with this because it

will be a universal basketball staying within regulations. This basketball will have the logo

Spalding across it just like any other orange basketball that Spalding produces. The only

difference will be the design of the inside of the ball. The “G-Cell”, will be able to withstand all

weather conditions. It will be designed to be and inside and outdoor basketball.

Price

The Spalding “G-Cell”, basketball has been priced at a value of $65.99. This price had

been determined off of the advancement of the basketball and the value of the product. This

basketball is also very affordable to consumers because they will not need to purchase so many

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basketballs throughout the year because the air will stay contained in the ball for a longer period

of time because of the gel. There is a one year guarantee that has been set on the basketball if

there are any problems. We want our consumers to be satisfied with their purchases. Spalding

basketballs range anywhere from $10.99 to $169.99 so that is how the price of the “G-Cell”, was

determined. The “G-Cell”, is a very reliable ball so with a price of $65.99 consumers will

purchase at this price.

Place

The “G-Cell”, basketball will be distributed and sold throughout retail stores across the

United States. The stores that this product will be primarily sold in are major sporting goods

stores including Dicks Sporting Goods, Olympia Sports and Sports Authority. Also locally own

sporting goods stores will be distributed the product as well. This product will be located with all

the other basketball equipment so it will be easily accessible to consumers. They will remember

and know right where to look for this product. To broaden the market we will also have an online

website featuring the Spalding “G-Cell”. This will help it become more easily available to

consumers. We will place it on the Spalding website along with the Dicks Sporting Goods,

Olympia Sports and Sports Authority.

Promotion

In order to sell a vast amount of the Spalding “G-Cell”, we will need to promote our

product. It is our goal as a product of the brand Spalding to beat out all other competitors to sell

the most of our product. All of our promotions will be shown through various advertisements

such as television, internet, and magazines. Through these various advertisement strategies we

will ensure that our product is well- known throughout the market. The advertisements will be

aimed at our target market of teens aging thirteen to twenty years of age. LeBron James will be

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our spokesman of the Spalding “G-Cell”, because he is such a well-known figure in the sports

industry. Our target market will look up to him and think wow, if he uses the Spalding “G-Cell”,

I need to purchase it. Our advertisements will be what attract the teens to our product.

Television

With advertising on television we need to broadcast them on channel networks that

appeal to our main target market and consumers, teens while keeping in mind that this is a

sporting good product. These commercials will be thirty seconds long. LeBron James will appear

in commercials explaining what the product is and what it is used for in order to appeal to a vast

audience. James will make the commercial entertaining by doing funny slam dunks for instance

and have a catchy phrase at the end of the commercial so consumers remember what the product

is and will want to go out and purchase it right away. The major network channels that will

display our product through commercials are ESPN, MTV, FOX and NBC. This will be able to

get out to a large target audience making our product have more awareness. Our main source that

our commercials will be aired on is ESPN. The Spalding “G-Cell’s”, main consumers are

athletes and many athletes watch ESPN on a daily basis. However, ESPN is directed more

towards males that is why MTV is being added to the mix to appeal more to the female’s

however also getting more awareness out to the males. FOX and NBC have been included in this

because sporting events are being displayed on these channels. Television will be our main

source of advertisements.

Internet

The internet has been growing at a faster rate today. Many people use internet several

times throughout the day. Our target audience uses the internet so much that internet has now

been accessible through our phone devices. Teens are very involved in the technological world in

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this day and age because they have grown up with it and have been accustomed to it. We will put

advertisements on ESPN’s website, create a Twitter account, and a Facebook. These three

websites are most commonly used by our target audience.

The Spalding “G-Cell”, will be shown on the ESPN’S website in order to appeal to the

sporting goods consumers. This will include have a “G-Cell”, banner with LeBron James

featured in this banner to promote to basketball fans. Twitter will be created and used to promote

the “G-Cell”, because it is a very common social network that will be able to get the name out to

our target audience. Another social network that is commonly used it Facebook amongst teens.

On the sides of the Facebook include advertisements so we will put a Spalding “G-Cell”,

advertisement on the side.

Magazines

Magazines are a wonderful way to get your product to have awareness amongst

consumers. Many teens purchase magazines and have become yearlong subscribers to certain

magazines. Through the use of advertisements the “G-Cell”, product will become very well-

known to consumers

Public Relations

Maintaining good public relations between the sport organizations and the publics on

which the product is a success or failure is very important. We want the news to write a good

review of the sports product, Spalding “G-Cell”, to create more awareness of this new innovative

product of the basketball. This will most likely be viewed through new releases and press

conferences. As a producing a product to benefit the company we will need to ensure that all the

public has a good idea of what our product is. The “G-Cell”, will be readily available for the

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public to touch, feel and try what it is like to play with the Spalding, “G-Cell”, so they have a

better understanding of what it truly is.

The Spalding, “G-Cell”, will also be involved in the community. The company will

provide “G-Cell”, products for the Toys-for- Tots foundation in order to provide holiday presents

to the less fortunate. This will help our product be more recognizable to our market while doing

something good for the community.

Areas to Leverage Marketing Mix

In society wants, needs and demands are changing at a rapid pace today. New innovations

are always coming about to better a product. Once a newer product comes out consumers want it

and need to get it right away. Therefore, we as part of the Spalding brand need to be aware of the

changes that are going on throughout the market. We need to keep a heavy eye on what is going

on within our consumer’s needs. Once the product, Spalding “G-Cell”, has been released the

numbers of consumers purchasing this product will be carefully looked at. Determining if there

needs to be any changes or not to the product is very important to consider. The price of the

product may be too high or too low towards consumers. The size and weight of the ball will also

have to be a factor in determining if our product is being sold successfully. Another area of

consideration would be our advertisements. Are our advertisements appealing to the audience?

Do we need to do more promotions? Do the promotions work that we have? These are all issues

that we need to consider.

SALES

Sales Management

Being that our product is one of kind we are going to make sure that our consumers know the

exact purpose and new advances in our revolutionary basketball. This new product that we

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developed is something that took a long time and a lot of research to develop so we want to set

this product up for success. First is coming up with a Sales Plan. This effective plan is to guide

our product into achieving maximum sales. In this sales plan we are going to have a sales

representative develop a plan that will ensure a high level sales and he or she will guide so that

we can meet all our objectives. To set our product up for success will also need to regular

reporting. These sales plans should be established on a weekly basis and then be reviewed on a

monthly basis to carefully track the sales of product is creating. Sales management involves

reviewing the results against the plan to determine missed opportunities and areas for

improvement. That is something we will be doing day in and day out. Numbers don’t lie and

successful sales plan focuses on result and activities. We are going to track as much activity as

we can to make sure we know what we need to focus on.

Sales method / rationale

There are many ways to sell our product but we feel to achieve maximum sales we need to focus

on retail. Our main target is basketball athletes, so we need make sure that retail stores really

educate their sales associate on our product. We are more than aware that sometimes the product

sells itself but we can never be too comfortable. Every consumer walking in the door should

know something about our product and the differences in quality between basketball and others

out there. Retail offers something that it extremely beneficial in selling a product. It’s that one on

one conversation. That one on one conversation either makes the sales or drives the consumer

away. Sales associates approaching customers need to right away build that sense of trust and

really educate the consumer on our product. This was it isn’t just a sales transaction it’s more of

a conversation and them being informed on something that could benefit them in the long run.

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Customer relationship plan

In order for us to really have consumers believe in our product we need to develop a relationship.

Some of the way we are going to do that is having the top NBA players use and promote our

product. When consumer idolizes a certain athlete they tend to try to imitate them from shooting

form down to the products that they use. We would use that and get top basketball players to use

and promote our product. Other ways we would improve our relationship with our customers is

actually going to these major cities that are rich in basketball tradition like New York, Los

Angeles, Boston, Miami, etc. and really give demonstrations so that these consumers who are

also athletes can see the difference between our product and other products out there. We want

these consumers to see that our product is the best product out there.

FINANCIAL ANALYSIS

Sales Projections

Over the course of our first year, there will be many opportunities to make sales. If we

implement in August, this will give us an advantage due to the fact that it is right before pre-

season basketball starts. As previously stated, the “G-Cell” will be sold for $65.99. We are

expecting to sell 40,000 within the first year. Because price multiplied by quantity equals

revenue, we are hoping to bring in $2,639,600 within the first year. These are just estimates and

have the potential to change.

Month Expected Basketballs Sold Revenue (U.S. Dollars)August 1000 $65,990September 2000 131,980October 4500 296,955November 4000 263,960December 4000 263,960

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January 3500 230,965February 3500 230,965March 3500 230,965April 3500 230,965May 3500 230,965June 3500 230,965July 3500 230,965Totals 40,000 $2,639,600

Expense Projections

There are many expenses associated with a new product. These mainly include the cost to

produce, marketing, endorsement, building rent and utilities, and employee salaries. Our

estimated cost to produce the product came out to be around eight dollars, which includes the

price of packaging. Our marketing budget is about $100,000. A majority of the budget will go to

LeBron James for his celebrity endorsement of the product as previously stated. Our brand and

product will easily be marketed because Spalding already supplies all of the balls for the NBA as

well as footballs for the AFL. Spalding/Russell already has a plant in Bowling Green, Kentucky

and pays for utilities, so nothing changes in that aspect, it would just be factored into their

current everyday expenses. We do expect to hire ten new employees on top of what Russell

Athletics already employs to specialize in the “G-Cell”. They will start out costing the company

a total of about $30,000, so in total, $300,000. Total expenses in the first year are $720,000.

Month Cost to Produce Marketing and Endorsement

Employee Wages

August $8,000 $100,000 $25,000September 16,000 25,000October 36,000 25,000November 32,000 25,000December 32,000 25,000January 28,000 25,000February 28,000 25,000March 28,000 25,000April 28,000 25,000

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May 28,000 25,000June 28,000 25,000July 28,000 25,000Total $320,000 $100,000 $300,000

Income Projections

The accounting bottom line is the most important to a company. As we all know, income

is sales minus expenses. Russell is a for-profit, private company whom will keep all earnings.

“G-Cell” by Spaulding will have a positive bottom line. We have carefully planned our expenses

and have evaluated our sales projections as being reasonable.

Month Projected Sales Projected Expenses

Projected Income

August $65,990 $33,000 $32,990September 131,980 41,000 90,980October 296,955 61,000 235,955November 263,960 57,000 206,960December 263,960 57,000 206,960January 230,965 53,000 177,965February 230,965 53,000 177,965March 230,965 53,000 177,965April 230,965 53,000 177,965May 230,965 53,000 177,965June 230,965 53,000 177,965July 230,965 53,000 177,965

+$100,000Totals $2,639,600 $720,000 $+1,919,600

EVALUATION AND CONTROL

Monitoring of the Marketing Mix

The marketing mix includes price, product, place, and promotion. In regards to the price,

we will keep records from our sales as well as our retailers such as Dick’s Sporting Goods and

Modell’s. If our company realizes the price is either too high or low for consumers after direct

competition joins or high demand is present, we will adjust accordingly. Price is one of the easier

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aspects to monitor within the marketing mix. With the product itself we will run inventory

checks at our stores as well as selected retailers. Also, if needed, we can adjust the gel inside of

the basketball as well as the textures. The place aspect of the marketing mix is one that has many

opportunities. As stated, we will monitor our retail outlets and make adjustments if we feel that

one is not working out for our company, mission, and values to ensure that Spalding and Russell

Brands continues its good reputation with the public. We will also want to locate our product on

the eye level shelves or on end caps within the place itself. Our promotion with LeBron James

will be closely monitored. Many athletes do things that would hurt our public relations image, so

we want to keep an eye on it in the event that something negative reflects on him. We could

switch our endorsement to someone who is more popular at that time as well. While the NBA

considers Spalding the “Official Game Ball of the NBA” this should also be examined in the

event that the NBA has negative publicity. Also, we will monitor the sponsorship that Russell

Brands already has which include the sponsorship of 500 D1 teams and being the official

outfitter of every Little League World Series to ensure our “G-Cell” will have the best reputation

inside and outside of the court. Overall, we want the “G-Cell” experience one that is beneficial

for the consumer, retailers, and our company.

Plans for Adjustment

Before introducing the “G-Cell”, we will plan everything we think will pertain to the

future of this basketball. Realistically, changes will most likely have to be made. If we were to

adjust, it would most likely happen within the first year. The “G-Cell” itself could be adjusted by

adding more of less gel to the basketball. Over time we can always add more endorsements or

change the athlete. Children and young adults want to purchase (or have the product purchased

by their parents) products endorsed by their favorite star. As previously stated, the price could be

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adjusted along with promotion items such as coupons or sales. A big adjustment that could

happen in the future is that we can market more to Grassroots programs to reach younger

children. Older children are already being marketed to in our projected plans but we can always

adjust it to younger children. Depending on how the public reacts to the new basketball, the last

thing we could do is adjust the basketball size and fell. We can add new sizes of the ball for

younger children or novelty, as well as changing the overall outside feel of the ball.

Anticipated Responses from Competition

With any new product comes competition. Our toughest competition will be coming from

Rawlings and Wilson who also are leaders in basketballs. They will most likely come out with a

similar product shortly after ours hits the market. Of course, we will patent the gel and

combination of the gel inside of the ball, which will last for fourteen years. As with any product

competition can find a way around this by slightly changing the product. Our company can

always respond with lower prices and improving our brand image so that even if there is

competition, ours will have a higher demand.