Professional Sports Teams & Organizations

Professional Sports Teams & Organizations

Brief Excerpt from Industry Overview Chapter:

Organizations in this industry include professional and semiprofessional sports teams and clubs. Major organizations include the Dallas Cowboys, Detroit Red Wings, Los Angeles Lakers, New England Patriots, and New York Yankees (all based in the US); as well as FC Barcelona and Real Madrid (Spain); FC Bayern Munich (Germany); and Manchester United (UK).

COMPETITIVE LANDSCAPE

Demand is driven by consumer income and corporate entertainment spending. The profitability of individual teams depends on achieving high fan attendance and a large TV audience, both of which are enhanced by effective marketing and competitive play. Teams in large metropolitan areas have advantages in the population base and TV audience they can draw on, though they may face competition from other teams. Teams in smaller markets, along with less popular sports and minor league teams, can compete by building fan loyalty through local marketing promotions and an appeal to civic pride. The US industry is concentrated: the top 50 organizations generate about 60% of revenue.

PRODUCTS, OPERATIONS & TECHNOLOGY

Major revenue sources for US professional sports teams are from sporting event broadcasts accounting for about half of the industry's revenue, followed by admissions to live sports events which accounts for 30% of the industry revenue. Other revenue sources include advertising space, sponsorship rights and live sporting events, accounting for about 10% each).