Stacy Danley: Two Types of Revenue for Sports Teams
According to Stacy Danley, while there are several different kinds of sources of revenue in sports, there are only two categories: game and non-game.
Game Revenue involves the earnings of a sports team in a professional league during game day. Attendance is a vital revenue driver, indicating how many fans attend games and other special events. That said, it isn’t the only revenue source.
Stacy Danley mentions sources such as ticket sales, sponsorship deals, concession purchases, and even stadium parking as contributors to the bottom line. Different types of games will also contribute in different ways. It will largely depend on the number of people they draw and the excitement they generate.
There are a few terms you might see when it comes to game revenue. First, there’s ticketing, which sells venue seats to watch the game. Merchandise pertains to the sales of apparel and other items with the team’s official logo, mascot, or other trademark, including T-shirts, hats, balls, mugs, and more.
Concessions are the sales of food and drinks at the venue. Parking is the revenue from paying parking itself.
Then, there are corporate sponsorships, which essentially give companies exposure to the team’s audience onsite. Revenue from suites comes from reservations of private seating sections and luxury boxes within the stadium venue. The Per-Cap Revenue is every dollar spent per game attendee.
Stacy Danley explains that three periods generally make up a team’s season. Pre-Season refers to the time before the start of a new season when athletes warm up with exhibition games that do not affect the team’s official ranking of the team for the season. Regular Season refers to the series of regulated games wherein wins and losses become part of a team’s overall ranking in the league. Post-Season refers to the period after the regular season ends when the highest-ranking teams compete in playoffs and championships.
All of that aside, games aren’t the only source of revenue for teams. There is Non-Game Revenue as well. It points to all the revenue an organization can generate outside the stadium, including broadcasting deals, sponsorship types, and online merchandise sales.
According to Stacy Danley, non-game revenue became tremendously important during the early days of COVID-19 since in-person events came to a halt and sports teams had to look for new sources of income.
Professional sports teams share national revenue with the entire league. For this, each team gets a share of the league’s TV and radio broadcasting deals, nationwide league sponsorship, and other shared business ventures. Local revenue, on the other hand, is earnings from teams’ own local media deals as well as their team-specific sponsorships.
Just like game revenue, non-game revenue also depends on sponsorships. There are a variety of sponsorship types that reach outside of the stadium. In many ways, non-game sponsorships earn a team much more money. Non-game sponsorships range from broadcast and digital media to technical sponsorships of products and services. Sports apparel is the perfect example of this.
Lastly, Stacy Danley mentions online merchandise, which includes e-commerce sales of apparel and other merchandise that feature the team’s official logo, mascot, and other trademarks.
Stacy Danley is the President and CEO of SLD Sports Management Group, a premiere management consulting, sports, and special event marketing and management company specializing in providing quality event management corporate consulting, strategic planning, fund-raising, new business development, sales, and corporate marketing. He graduated from Auburn University, earning his Bachelor of Science in Adult Education and Master of Education in Administration of Higher Education. Follow this page for related posts.