Across the country, cities invested millions of dollars into sports delveoplment strategies to keep or lure pro teams to their city (Waldron). For example, the city of Cincinnati spent 424 million dollars on the Cincinnati Bengals but later “had to sell a public hospital to clo se budget holes” (Waldron). The financial numbers are stagering. Some of these cities previously expended money on the sports entertainment market but mysteriously ran out when it came time to balance the budget or to make vital improvements in the city. Cities will continue to spend large amounts of funds on NFL teams because the allure of the franchise and the notority they bring with them is to great to say no
The cost of a single professional athlete can vary from one dollar to thousands of dollars. The objective of the game is to invest in a player that you believe can play above his/her worth believed by the company. By the end of the game for the athlete, the reward or loss is proportionally factored into what you payed for. This means that the more money you put into a player, the higher the reward or loss is. Looking at the size and worth
I would lower ticket prices and have different promotions for the team throughout the football season. The second marketing theory is Maslow’s hierarchy. I feel it is the most important theory. It starts with the physiological needs. The stadium needs to have food all around the arena, clean bathrooms and drinkable water.
It is difficult to compete with basketball and football, as basketball is a shorter season and shorter game time. Football is almost “too big to fail” as it is America’s sport now and everyone wants a piece of that pie, especially Patriot football. Question twelve is a testament to how success and demand and skyrocket the price of a ticket. I am not speaking of the Nor’easter success, but the Red Sox, in which during their World Series winning 2007 season the difference between the cheapest ticket and the most expensive, dugout ticket was a difference of three thousand percent! The people don’t know the Nor’easters, so at best, 48% of the responders would pay 10% more between bleacher seats and club/dugout seats (Cespedes, 2009).
In the following articles, “Homefield Economics: The Publics Financing of Stadiums,” by Christopher Diedrich and,” The Stadium Gambit and Local Economic Development,” by Dennis Coates and Brad R. Humphreys they discuss what the advantages and disadvantages are of having Publicly funded stadiums built. The social benefits that professional sports can have on an economy. The associated benefits of having professional sports team players living in the city has on the economy. The articles discuss how the public investment can help with economic benefits, new jobs and more increased tax revenue. Diedrich says that the economic benefits are not nearly as good as the quality of life benefits.
Market One; Elastic Demand- As football season approaches, so does the commercials to gain viewers (subscribers). Whether it is DirectTV with its lucrative offers of NFL Ticket or Dish Network with its Redzone, both are elastic in nature because these fall into the understanding of luxuries or non-necessities. These companies have challenges, and as DirecTV Chief Executive Michael White has pointed out, “There’s a much bigger issue, which is the price elasticity challenge when you’re trying to raise prices when median household incomes are flat, particularly for those making less than $50,000 a year.”(DirecTV)
Another study performed by Dietl et al. (2009) provides a theoretical model of a team sports league and studies the welfare effect of salary caps. It shows that salary caps will increase competitive balance and decrease overall salary payments within the league. Advocates of salary caps in professional sports believe that an increase in competition across a league sparks regional and national interest. More competitive leagues draw higher television audiences, costlier media contracts from television networks and more lucrative contracts from advertisers.
For example, if you want to get the best deal on a ticket, it 's better to wait. You always take the chance of not getting a seat if you wait, but that 's why early sales go at a premium. The Network Journal reports that Superbowl ticket prices can drop
When the players perform well, the fan base increases along with the revenue. Universities and colleges will profit off these retail items with their star players’ names across the back as a higher customer base is achieved. The generated revenue circulates back into the school and opens up more opportunities for new players to be recruited and given scholarships to be part of their teams. This extra profit then becomes available to sponsor less popular sports that generates a higher output than input in sales. Alternatively to checks and cash, the school returns that generated revenue to their students by issuing out meal plans, scholarships, supplies, books, and other essentials.
(Levray, 2013). Blame the fans for buying the merchandise. Each time a fan buys a player signature shoe, gear , or team gear the money goes to them. Each professional team has a salary that they need to go by. They can’t just go and spend all the money on one player.
Professional sports are a growing entertainment industry in the United States. It is projected that the North American sports market will be valued at 73.5 billion dollars in 2019, with an annual growth rate of 4% (PWC, 2015). A large part of this value can be attributed to the construction of large and expansive stadiums. From 1989 to 2009, it is estimated that 31 billion dollars was spent on venue construction for the five major professional leagues in the US (NFL, MLB, NBA, NHL, MLS) (Marquette University, 2009). This is due to constant construction and renovations.
When examining the ticket sales of the MLS in the first decade, there has been a positive correlation with the “marquee” or big-name players initially. The article “Determinants of Attendance in Major League Soccer”, by John Charles Bradbury, combines the data from the 1996-2019 seasons and takes an econometric approach by organizing the numbers into the four main categories to address how “team performance, novelty effects, market demographics, and marquee players” influence the attendance of the MLS (Bradbury 53). The MLS didn’t start buying big-name players until 2007 when they created a rule so that they could sign one of the best English players at the time, David Beckham, and they instituted this designated player rule, which “allows teams to exceed the league’s salary cap to sign a limited number of supremely talented or famous players who have opportunities to play in the world’s top-tier soccer leagues” (Bradbury
Marketing jobs have opened for athletes more recently but have generated many prophecies for the economy and sporting teams. The economy is extremely impacted by the consumer spending that takes place during their visits. Tourists who come to games have to make themselves a livable space and live a memorable moment. Sports tourism increases local businesses' income, transportation, hotels, and restaurants (Tap). When a city hosts an event, fans need a place to stay, eat, and activities to do.
Even better, people would love to attend professional games with their friends and families. Unfortunately, most people are unable to go because of how expensive tickets are to watch just one game. Seats for one person can get up to 10,000 dollars, now imagine how much money it would cost if you were going with your family. Prices should be lower so that more people can attend. If this was the case, sports can be enjoyed by most people and they could go to games personally, and maybe more than once in their
When people go to professional sporting events they are paying a portion of athlete’s salaries between the food, the ticket, and betting on their team. Douglas points out that athletes can’t be paid their millions of dollars if we do not watch them so then the case is brought up: we as a community put value on sports and that is why they get paid millions of dollars a year. Fans continue to show up to games and the athletes make money. “As long as those fans continue to show up or tune in,… the players deserve every penny they get” (Anastasia). If no one showed up to the games athletes would not deserve their pay.
