Test Post

Testing the main page format.

Video: How the Economy is Affecting Sports

For those of you who are not strong readers, here is a three part series on how the economy is affecting sports.

Continue reading

How the economy is Affecting Sports: Corporate Sponsors

Even if you think NASCAR doesn’t qualify as a sport, it is hard to deny it is at least a spectator event, drawing over 100,000 people to the track on average. The difference between NASCAR and other professional sports is its high reliance on corporate sponsors to support their teams, drivers, and cars, making it the perfect launching platform into how the economy is affecting corporate sponsorship.  I mean who doesn’t think Dale Earnhardt is a name synonymous with Budweiser? Recently though, NASCAR has been struggling because of the economy and it’s affect on how much corporations can denote to racing. NASCAR legend Richard Petty said last month, “The economy changed everything,” as he tried to explain the off-season decision to close Petty Enterprises, begun in 1949 by his father, Lee Petty. The team merged with Gillett Evernham Motorsports and will race under the name Richard Petty Motorsports. Continue reading

How the Economy is Affecting Professional Sports: “Second Tier Sports”

I was orginally planning of writing my fourth installment of the economic situation surrounding professional sports on future draft transactions in the NFL, MLB, and various other leagues. As I researched the subject I came across all sorts of material concerning what I deemed “second tier” leagues such as the WNBA, Arena Football, and NISL (National Indoor Soccer League). By “second tier”, I mean professional sports that are not necessarily on ESPN’s Sports Center on an every day basis, and do not have nearly the economic strength and fan bases the major leagues like the NFL, NBA, MLB, and NHL enjoy. Many of these leagues and franchises have been under enormous pressure because of the economy, with some of them even postponing seasons a year in hopes of an economic rebound next year. I will begin first with the Arena Football. Continue reading

How the Economy is Affecting Professional Sports: MLB

Not even the nation’s wealthiest baseball franchise is immune from the economic downturn. Recently, New York Yankees’ brand new stadium has plenty of empty seats, and it’s not in the nose bleed section. It’s the seats behind and to the side of home plate, the cleverly named Legends seating. Continue reading

How the Economy is Affecting Professional Sports: Owner’s/Player’s Perspective

Houston Texans owner Bob McNair sums up the situation surrounding owners and professional sports team in the failing economy.

“It’s a different business atmosphere than 20 to 30 years ago. Originally, we worried about selling tickets. Now we’ve got to worry about selling tickets, about keeping media partners happy, operating stadiums, keeping fans happy in the stadium, servicing debts. We need a structure that works long-term. We can’t expect the fans to pay more and more and more. We have to hold all our expenses down and labor is just one of them.” ” Continue reading

How the Economy is Affecting Professional Sports: Fan’s Perspective

When starting my research on the recent economic depression and it’s affect on the sport industry, I believe the topic would prove relatively clear cut; increased economic pressure would cause fans to buy less tickets, thus decreasing revenue for franchises. After reading a few articles, I arrived at the conclusion that my preconceived notions were somewhat accurate, but do not nearly encompass the entire situation surrounding sports. First I will provide a few examples confirming my original hypothesis, followed by outliers rejecting this notion.

While trying to decide whether to buy New England Patriot and Boston Red Sox tickets this upcoming season, Kent Haines, a father of two, has decided to forgo these usually yearly expenditures.

“In this sky-is-falling economy, attending a pro sporting event is last on my list. When you combine the cost of the tickets with the effort it takes to get our fannies in the seats, watching on TV with my wife and kids sounds pretty good right now.” says Haines.

The cost of tickets and surrounding expenditures when going to a game just is not worthy of the return on the investment. In other words, watching the game for often hundreds less on a high definition TV, in today’s economy, enacts a much higher entertainment and overall viewer satisfaction return. Recalling that in May he dropped $250 for tickets, parking, food and a souvenir for himself and his 10-year-old son, Zach, at Fenway Park, Haines echos a sentiment shared by many other sports fans throughout the country. Similar to Haines, who based his purchasing decision on ticket price vs. experience at home, overall sport fan and father of two, Michael Popham has seen his spending on sporting event decreased significantly.

“I am a 27-year-old father of two and my spending on sports has dropped dramatically as the economy has sputtered. In years past I would take both of my kids to games and buy all sorts of concessions and souvenirs. Recently though the quality and quantity of seats that I purchase has diminished and the quantity of money spent during the game also has dramatically dropped. I am a huge baseball fan and every year since I was a child would go to multiple games a month just for the joy of being at the ballpark but now with the high ticket prices and parking fees I will only attend the three games my team comes to town. I would love to take my son to an NFL game but at $200 dollars for two tickets and parking the cost is not worth the return.”

Fathers like Popham, whom as children experienced many sporting event and developed lasting memories, are finding it difficult to provide the same sort of special experiences only found in live sporting arenas. When buying tickets, what many people fail to realize is the cost surrounding the games outside the initial ticket purchase. For example, at a recent Phillies game I attended at Citizen Bank’s Park my upper level seat cost 35 dollars.Throw in parking cost at 10 dollars, hot dog, soda, popcorn, and peanuts cost a combined 17, and finally a pack of Phillies official trading cards at 3 dollars. All these costs calculated together adds up 30 dollars; only five dollars less than what I paid for the ticket in the first place! I could not even imagine the cost if I had to take a son along with me and the costs he would incur. This example demonstrates the growing trend surrounding sporting events. More and more fans are finding it hard to constitute spending a good portion of their pay checks on tickets to games coupled with the other costs surrounding the entire event. While both father Popham and Haines struggle with the choice of buying ticket vs. watching on TV, other fans like Mark Weinstien of Georgia struggle in selecting which events they want to sacrifice.

“The current economic situation impacted me as far as this is the first year in a long time I did not attend a baseball game. I am going to a football game but will have to strongly consider finances when deciding to attend a hockey or a basketball game (something I try to do on a yearly basis also).”

Weinstien still is electing to attend sporting events, but at the same time has the tough decision on which ones to attend. In the past, he has watch live an array of different sporting spectacles, now he has to choose between sports. This idea hit me especially hard because I love every sports team in Philadelphia and having to question my loyalty to different teams in the same city is a extremely disheartening idea. Although the data has not surfaced concerning how the economy has affected viewers between leagues, its will be interesting to see in the future how this conundrum played out. Unlike the examples above, some families plan to attend the same amount of sporting events, while at the same time sacrificing other aspects of their life. Take Adam Stevenson of Toronto for example,

“I am an avid Toronto Blue Jays fan and attend spring training each year. As a family, we attend roughly 5 games a year and spend an average of $200/game including tickets. Will we spend less now? Probably not. That’s because we budget accordingly for the things we enjoy to do. We don’t spend more than we have on things that we THINK we need — baseball included.”

Instead of electing to exclude sporting events from their costs, Stevenson has decided to spend less on other aspects in life in order to spend more on sports. Many Americans, myself included, love sporting events so much that they take precedent over other aspects of life. Luckily for me, Philadelphia has been relatively successful, in terms of winning, over the past decade with their sports franchises, but other teams, such has the NFL’s Detroit Lions, have seen their attendance and fan support dwindle over the years. Take Lion’s Brian Blight for example,

“I won’t attend another Detroit Lions game until they prove to me that they are competitive. Matt Millen did not fair well up in Detroit, but that organization stunk long before Mr. Millen arrived at the scene. I wish they would dissolve the whole team!! The Detroit Lions are an embarrassment to the NFL.”

This goes to show that the economy sometimes has no affect on whether tickets sell. The NFL year in and year out has been the most popular and profitable league in America, but if your team fails to win on a consistent basis, fans will begin to question their decision on purchasing tickets. Especially in such an economically troubled place like Detroit, ticket sale will see significant decline is the Lions can not find a way to win at least one game this year. (Lions went 0-17 for the first time in NFL history last year).  In cities like Boston and New York, teams have fared well and championships have been one (Patriots, Celtics, Giants etc.) and it reflects considering both cities boast the highest average ticket prices in America.

The example shown above of real American sports fans and the affects of the economic downturn demonstrate a growing trend. Where fans used to buy tickets on the regular without much thought, now household budget, or totally eliminate live sports expenditure. In my next post, I will evaluate how this startling new sentiment has affected the approach franchises and owners take towards ticket sales and overall profit gathering.

Sources:

“Economy dips and fans react.” Michael McCarthy, USA Today. October 17, 2008

“Sports, too, hit hard by the economy.” Dan McGgrath, Chicago Tribune. December 16 ,2008