Recession Spending in Sports

Thursday, August 26, 2010

Recession Spending in Sports

In these tough economic times, it is interesting to see how the sports industry stays afloat. Even though the sports industry is among the most lucrative, it would be reasonable to assume that it has not been immune to the current economic slump.

The reality is that innovators in this field are finding continued success by developing creative ways to boost their clubs or capitalize on audience needs.

One the most prominently endorsed sports is NASCAR.  It is one of the few sports where the drivers actually wear their sponsorships and their equipment is plastered with logos as well (The fictional character Ricky Bobby’s Fig Newton’s fiasco comes to mind).  They might be considerable risk in touting sponsors so openly, but NASCAR seems to be holding on to its lucrative deals, and even developing new ones.


Their secret? A passionate and loyal fanbase.  

NASCAR marketing officials are trying to provide companies with more bang for their buck by  zeroing in on certain demographic groups, and by asking their drivers to promote in ways beyond wearing their brand. Sponsors are seeing opportunity, and NASCAR is willing to work with them to provide the best return.  Of course, a receptive client is the best client. 


The English Premier League finds itself on the upswing as well.  Like NASCAR, the EPL directly and prominently features their sponsors on their players, and this practice alone generates the greatest percentage of revenue. Overall, the EPL has raked in £99.75 million – a significant jump from £71.8 mil last year.  Larger clubs like Manchester United are bringing on deals around the £20 mil mark, but what to do about lesser powers? 

This is where creativity is coming in: Clubs are penning deals that provide multiple sponsors within a season. For example, Tottenham signed with Autonomy for domestic games, and provided another sponsor for Cup games. By utilizing two companies, they are essentially doubling their revenue. Finding shorter deals may bring in lesser cash at first, but this practice allows teams to raise their profile quickly and create more branding relationships.

Back in the States, drawing on the loyalty and passion of fans seems to be paying off as well.

Recently Rivals High posted an article about a Texas high school providing its football team with a $59.6 million dollar stadium.  Yes, you read correctly.  The Allen High School football team has provided its community with great success, including the 5A-1 State title in 2008, but very little seating for its fans. In fact, non-students have to wait in line for tickets starting Monday morning to see the Friday night action.

Allen High's football Coach Tom Westerberg thinks the timing for this type of investment is perfect and will result in a higher profile for the team, more people in the stands, playoff opportunities and community events.

"The old Eagle Stadium was very good to us but just got too small," Westerberg said. "We hope the new field will continue to be a home-field advantage for us."

Seems like everything is bigger in Texas, including opportunities.


~MiaTweet