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About This Sports Industry Report
SPORTS EVENTS
The Heart of Sports Business
Over the past year, many sports industry professionals and academic instructors have requested specific chapters from our book, The Business of Sports. The 450 page, 12 chapter book is available online ($79.50) and in print ($99.50) at www.globalsportsinsights.com. In response to those interested in selected topics (e.g., How Big is the Sports Industry? Youth Sports, Sports Entertainment, Sports Betting), we are now offering a menu of more focused content, very reasonably priced.
Below is a brief summary of the essential content of our Sports Industry Report on Sports Events. It is the result of an intensive search of the most current, relevant and credible data sources on this topic. Woven into the analysis are a number or videos and exhibits highlighting new trends in sport facility operation and development.
This report focuses on the four core revenue-generating sources of live sporting events: Gate Revenues, Media Rights, Sponsorships and Merchandise. In 2023, these event revenue sources generated $208 billion worldwide. North American sports events contributed nearly half of the global total, $94 billion.
The report analyzes the relative contribution of each primary revenue source to overall event spending over a 6-year period. This analysis includes an examination of the impact of COVID-19 on event revenues at the height of the pandemic and rates of recovery for each source through 2023.
Over the past decade, $155 billion has been spent globally building/renovating sports facilities (nearly $65 billion in U.S. and Canada). The report catalogs the number and amount invested annually on new facility construction globally and in North America. Analysis focuses on the new generation of facilities loaded with features to enhance the fan experience, and the emergence of a new wave of stadiums and arenas serving as the centerpiece of Sports Entertainment Destinations, such as SoFi Stadium in Los Angeles.
For instructors planning to use this report as a required reading, we provide extensive Instructor Support materials, including: Slides of key report graphics, Discussion Questions, and a Test Bank including multiple choice, short answer and essay questions.
We hope you find our report of great value and thank you for your purchase.
Sports Industry Report
Contents
CONTENTS
The Heart of Sports Business
The heart of the sports industry is the hundreds of thousands of organized games, matches, and races that occur around the globe each year. Fueled by competition, drama, and pageantry, passionate fans in the hundreds of millions attend and watch sports events played in ever more lavish and expensive stadiums and arenas.
Gate receipts are just one component of the revenues derived from sports events. Money spent by fans to park and to purchase food and beverages adds to event revenue, as does the sale of media rights. Media companies pay teams and leagues to broadcast their events on TV, radio, or the Internet. (Figure 1.1).
FIGURE 1.1
Sports Events Segments
Sponsorships – money a corporation pays to a team to advertise and promote its brand at events – are another important source of sports event revenue. Sponsorships can range from placing brand names or logos on player jerseys to investing millions in placing a corporation’s name on a stadium or arena.
The sale of team or league merchandise at events, in retail stores, or online also provides revenue for teams, leagues, and sometimes athletes.
Finally, the billions invested in constructing a new generation of “state of the art” stadiums
and arenas full of expensive luxury seating options and amenities has produced abundant income streams for team owners and event operators.
Copyright 2024 The Business of Sports
01
Sports Events
FIGURE 1.2
Sports Industry
An in-depth examination of each major event revenue source presented in Figure 1.2 will be the focus of this chapter
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Copyright 2024 The Business of Sports
Sports Events
FIGURE 1.3
Global & North America Sports Events Revenues (billions)
Before we start, it is important to understand where sports events fit into the Best-Howard Sports Industry Model. As shown in Figure 1.2, sports events are one of three core areas of Fan Engagement in the Best-Howard Sports Model. The $227.2 billion generated from all five event segments accounted for 30.3% of the $750.3 billion total global revenues of all three Fan Engagement core areas, including sports media ($150.5 billion) and sports entertainment ($372.6 billion) in 2023.
The steady growth of sports event revenues globally came to an abrupt halt in 2020 (Figure 1.3) (1). The COVID-19 pandemic led to over 20,000 cancelled events and attendance losses of 198.2 million fans in the United States alone. Global revenues plummeted $50 billion, falling to a 10-year low of $140.7 billion. Nearly half the loss was accounted for by North American sports properties which lost $24.8 billion in 2020, also dropping to a decade-long low of $60.2 billion.
However, with the return of fans to live events around the world during the 2020-21 season, those losses have been quickly recovered. Within three years of the depth of the pandemic in 2020, global sports revenues generated from event production (tickets, media rights, sponsorships, and merchandise sales) reached an all-time high of $208.4 billion. Professional sports leagues have led this global recovery in North America.
The collective COVID-related losses for all four major leagues in the U.S. and Canada amounted to $15 billion over the 2020 and 2021 seasons (2). Major League Baseball (MLB) suffered the most dramatic loss, plunging 64% from $10.3 billion to $3.7 billion. The pandemic resulted in the cancellation of over two-thirds of the league’s regular season games in 2020. By 2022, with the return of 65 million fans to ballparks and three new television contracts, MLB revenues reached a record $10.5 billion. The three other major sports leagues, led by the National Football League’s record-breaking $19.5 billion, also made rapid and robust recoveries. Total revenues in 2022 for the top four North American sports leagues rose to $45.6 billion, smashing the pre-Covid-19 high of $39.6 billion in 2019.