Professional Sports Teams & Organizations Industry Overview

Excerpt from Professional Sports Teams & Organizations Report

Organizations in this industry include professional and semiprofessional sports teams and clubs. Major organizations include Arsenal (UK), the Calgary Flames (Canada), Manchester United (UK), the New York Yankees (US), and Real Madrid (Spain).

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 industry is concentrated: the top 50 organizations generate about 60 percent of revenue.

Products, Operations & Technology

Major revenue sources for professional sports teams are admissions and tickets (35 percent of revenue); television and broadcasting rights fees (30 percent); advertising, sponsorships, and endorsement fees (10 percent); and concessions and merchandise sales (5 percent).