Lesson 1.2 Factors Contributing to Industry Growth Copyright © 2013 by Sports Career Consulting,...

Lesson 1.2

Factors Contributing to Industry Growth

Copyright © 2013 by Sports Career Consulting, LLC

LESSON 1.2

History of SEM

Increase in participation

More people following sports and entertainment

Increase in sports/entertainment offerings

Attendance boom

Media coverage

Global products

Factors Influencing Industry Growth


LESSON 1.2

History of SEM

Evidence of Increased Participation Rates

The U.S. Youth Soccer Association reports that there were 100,000 registered players in 1974. Today the organization has grown to 3.2 million registered players and over 800,000 coaches and volunteers


LESSON 1.2

History of SEM

The number of U.S. golfers has risen to 12.6% of the population vs. 3.5% 50 years ago



LESSON 1.2

History of SEM

According to the National Federation of State High School Associations, the sport of lacrosse has seen a 280% increase in participation in the last decade



LESSON 1.2

History of SEM

Among sports and recreation activities that grew more than 15% the past 10 years, skateboarding led the way with a 74.1% growth, according to the National Sporting Goods Association (NSGA)



LESSON 1.2

History of SEM

“Skateboarding saw a remarkable increase in the last 10 years, due in part, to the television exposure provided by ESPN’s X-Games”

- NSGA VP of Information & Research, Thomas B. Doyle



LESSON 1.2

History of SEM




Attendance boom

Media coverage

Global products

Emergence of Internet and new technologies



LESSON 1.2

History of SEM

U.S. television broadcast 800 hours of sports in 1971

NBC will live stream the entire 2014 Winter Olympics in Sochi, Russia, marking the first time that fans will have a chance to watch every Winter Olympic event live (compared with a total of 14 total hours of coverage from the 1964 Tokyo games)

Increase in Those Following Sports & Entertainment


LESSON 1.2

History of SEM




Attendance boom

Media coverage

Global products




LESSON 1.2

History of SEM

More options for sports as participants:

Disc golf the sport spread to 560 courses nationwide by 1995 and doubled that number by 2000. Today, the Professional Disc Golf Association boasts more than 4,000 courses globally and the game is played in more than 40 countries

Increase in Sports/Entertainment Offerings


LESSON 1.2

History of SEM

More options for sports as participants:

In 2013, Hawaii became the first state to sanction surfing as an officially recognized high school sport



LESSON 1.2

History of SEM

ESPN’s coverage features more than 65 sports including MLB, NBA, NFL’s Monday Night Football, NASCAR, MLS, FIFA World Cup, WNBA, college football, men's and women's college basketball, golf, Little League World Series, fishing, spelling, billiards, poker, arena football, eating championships, and the X Games



LESSON 1.2

History of SEM

DirecTV now offers over 285 channels as part of their “premiere” package, including over 50 channels dedicated specifically to sports programming (and that doesn’t include the seventeen “specialty” packages that require an additional subscription like the NBA League Pass, NFL Ticket or NHL Center Ice).



LESSON 1.2

History of SEM


LESSON 1.2

History of SEM




Attendance boom

Media coverage

Global products




LESSON 1.2

History of SEM

Attendance Increases

Despite playing just half a season thanks to a lockout that drew plenty of fan and media criticism, NHL league

attendance in 2013 was 12,758,849


LESSON 1.2

History of SEM


To put the league’s growth into perspective, the NHL’s attendance was 7,758,05 in the 1978-79 season


21,470,155

2012-13 NHL season attendance (lockout shortened season)

1978-79 NHL season total attendance

7,758,05

LESSON 1.2

History of SEM


Over 75 percent of movies in the top 50 all-time highest-grossing films (before inflation) were released after the year 2000. The highest grossing film in the 70s was Star Wars, at just under $800 million and in

the 80s was E.T., at just $750 million.


LESSON 1.2

History of SEM


Discussion Topic

Titanic more than doubled Star Wars at the box office in terms of overall global ticket sales, but is that the whole story?

Do you think twice as many ticket buying patrons attended Titanic than Star Wars? Why or why not?

LESSON 1.2

History of SEM


Discussion Topic

Although Titanic’s box office figures are incredibly impressive, the box office figures do not necessarily tell the whole story.

Ticket prices in 1997 were much higher than they were in 1977, the year Star Wars was released and box office records are not adjusted for inflation.

LESSON 1.2

History of SEM


Discussion Topic

When box office numbers are adjusted for inflation, the domestic top grossing film in American history is NOT Titanic.

What is it???

LESSON 1.2

History of SEM


Discussion Topic

After adjustment, the top spot goes to Gone with the Wind, while Titanic slips to just 6th overall…

LESSON 1.2

History of SEM




Attendance boom

Media coverage

Global products




LESSON 1.2

History of SEM

Media Coverage

Media coverage of sports and entertainment has grown significantly in the past half-century, placing athletes and entertainers in the public eye with incredible frequency


LESSON 1.2

History of SEM

Media Coverage

Introduction of Internet makes information available “on demand” with increased frequency and accessibility


LESSON 1.2

History of SEM

Media Coverage


Television and radio provide alternative news sources to newspapers while social media provides an even newer alternative to all other forms of media

Profit potential for media centers encourage increased competition for top stories

Introduction of Internet makes information available “on demand” and with increased frequency

LESSON 1.2

History of SEM

Media Coverage


“Arnold Palmer…came along at the same time television was exploding in America. Now we’ve got global Internet access. Our sport wasn’t global when I began playing the Tour. Now it is. You can log on anywhere in the world an see what any player did in any tournament or for the year. With that international boom, that international stream of information, golf is getting exposed to parts of the world that it never even thought of getting into.”

- Tiger Woods

LESSON 1.2

History of SEM




Attendance boom

Media coverage

Global products




LESSON 1.2

History of SEM

Global Marketplace

The international marketplace continues to provide a platform for driving sales of sports and entertainment products and services


http://www.imdb.com/media/rm3525150208/tt1458175

LESSON 1.2

History of SEM

Global Marketplace

Global events like Wimbledon, the Tour de France, FIFA World Cup, Olympic Games, the Iditarod and Cannes Film Festival attract world-wide attention, providing an exceptional marketing opportunity for ticket sales, sponsorship sales, licensing and merchandise opportunities and provide a major economic impact for host cities


LESSON 1.2

History of SEM

Global Marketplace

In 2010, ESPN, CANAL + Events and Tignes Ski & Snowboard Resort (in France) launched the first Winter X Games to be held outside the United States, and X Games Munich 2013 demonstrated the growth in global appeal of the event when 47.5 hours of action were broadcast across ESPN’s various platforms, including 26.5 hours on live television


LESSON 1.2

History of SEM

Global Marketplace

The global demand for footwear and sports apparel continues to grow with international brands like China’s Li Ning and Germany’s Adidas and Puma fiercely competing with American brands like Nike and Under Armour for market share


LESSON 1.2

History of SEM

Global MarketplaceA number of NBA All-Stars have recently opted out of relationships with American brands to pursue deals with Chinese sportswear brands, including Dwyane Wade who left Jordan Brand for Li-Ning, Steve Nash who left Nike to sign with Luyou, Kevin Garnett left Adidas to sign with Anta, and Kevin Love wears a new Chinese shoe brand, 361 Degrees. In 2013, Reebok intensified its marketing efforts to reach consumers in India (with its population of more than 1.2 billion people) by signing Indian cricket captain M. S. Dhoni as its ambassador, along with other yet-to-be-revealed “well-known personalities from different walks of life such as musicians, entertainers and professionals" (according to the Economic Times)


LESSON 1.2

History of SEM


LESSON 1.2

History of SEM

Global Marketplace

Prominent american sport are making a push to expand their presence overseas by hosting regular season games (not exhibition games) outside of the United States


http://www.google.com/url?sa=i&rct=j&q=mlb+logo&source=images&cd=&cad=rja&docid=Fw5df31T-W_PTM&tbnid=h0n-DXt--Zr6oM:&ved=0CAUQjRw&url=http://blogs.thescore.com/mlb/2012/08/28/espn-pays-5-6-billion-for-mlb-broadcast-rights/mlb-logo-90/&ei=F4L5UdHJHYLfrAHH04GwAg&bvm=bv.49967636,d.aWM&psig=AFQjCNFIvHQK1vHFZNT6GcmSjoSp_H3ySg&ust=1375392609908057

LESSON 1.2

History of SEM

Signs of Continued Industry Growth

The worldwide video game industry is poised to reach $70.1 billion by 2015, thanks to the combined growth of console, portable, PC,

and online video games, according to market researcher DFC Intelligence


LESSON 1.2

History of SEM


While the demise of the CD seems inevitable, sales of digital music continues to climb when in 2012, for the first time, digital stores sold

more albums than retailers and mass merchants like Target and Walmart

Digital services such as iTunes sold 37% of albums in 2012

While CD sales continue to slide, vinyl is on the rise, up a record 19% in 2012


LESSON 1.2

History of SEM


Digital services such as iTunes and Amazon MP3: 37%

Walmart, Target and other mass merchants: 29%

Best Buy and similar chains: 15%

Non-traditional outlets such as Amazon physical sales, mail order, venue and fan club sales: 10%

Indie stores: 7%


LESSON 1.2

History of SEM



Pandora radio now boasts over 200 million users

LESSON 1.2

History of SEM



The global theme parks market is projected to reach $29.5 billion by 2015, according to a report by Global Industry Analysts, Inc.

Also according to Global Industry Analysts, Inc., the global footwear market is expected to reach $195 billion by 2015

For the first time in history, ebook sales generated more revenue than hardcover books in 2012 while overall ebook sales have increased 4,456% since 2008

LESSON 1.2

History of SEM



In 1994, Nike’s soccer brand revenues were $40 million. In 2012, the company reported soccer revenues of more than $2 billion (adidas’ soccer division also surpassed $2 billion in sales in 2012).

LESSON 1.2

History of SEM


According to a story published on ESPN’s website, NBA commissioner David Stern told industry executives at a 2013 meeting that the league estimated revenues would be a record $5 billion, an increase of about 20 percent from the league's last full season in 2010-11 (the 2011-12 season was shortened by a lockout)

NFL media fees are projected to double to $8 billion annually by the end of the decade


LESSON 1.2

History of SEM


Centerplate, the leading hospitality partner to North America's premier sports, convention and entertainment venues, is now also the fastest growing restaurant chain in America, according to Nation's Restaurant News.

Centerplate serves over 115 million guests per year.


LESSON 1.2

History of SEM


In 2013, Forbes suggested that ESPN had grown to a valuation of $40 billion


LESSON 1.2

History of SEM


The 2013 NBA Finals on ABC between the Miami Heat and San Antonio Spurs was broadcast in 215 countries and 47 languages

Television audiences continue to grow in size while sports and entertainment properties expand the various means for distributing content (social media, streaming etc)


http://www.google.com/url?sa=i&rct=j&q=2013+nba+finals&source=images&cd=&cad=rja&docid=o7cNHR--jqE-tM&tbnid=-NMs0M2veO5gQM:&ved=0CAUQjRw&url=http://www.vegassportsbetting.com/&ei=ro_5Ude7NMPZqgGQ2ICIDA&bvm=bv.49967636,d.aWM&psig=AFQjCNFFBEkT17dpKrSkqR1DxM0iJtL4Qg&ust=1375396136795310

LESSON 1.2

History of SEM


Game 7 of the 2013 NBA Finals attracted the second largest audience since ABC started carrying the series while generating a 5% increase in viewership over last year’s NBA Finals between the Heat and Oklahoma City Thunder


.a.The NBA continues to be a leader in embracing social media surpassing 400 million likes and followers combined across all league, team and player pages on Facebook, Twitter, Instagram, Sina and Tencent. The NBA was the first professional sports league to exceed one billion videos viewed on its YouTube channel and now has more than 1.3 billion videos viewed overall (according to nba.com).

http://www.google.com/url?sa=i&rct=j&q=miami+heat&source=images&cd=&cad=rja&docid=TZ0u-_noD_iUdM&tbnid=mjxAfhGBUyyZ7M:&ved=0CAUQjRw&url=http://en.wikipedia.org/wiki/Miami_Heat&ei=k5H5Uar5I4PsqAGQw4HYBw&bvm=bv.49967636,d.aWM&psig=AFQjCNEKXD8QAzHfaQiUU-gKUlYLYCoNxg&ust=1375396625007129

LESSON 1.2

History of SEM


The NBA continues to be a leader in embracing social media surpassing 400 million likes and followers combined across all league, team and player pages on Facebook, Twitter, Instagram, Sina and Tencent. The NBA was the first professional sports league to exceed one billion videos viewed on its YouTube channel and now has more than 1.3 billion videos viewed overall (according to nba.com).


.a.The NBA continues to be a leader in embracing social media surpassing 400 million likes and followers combined across all league, team and player pages on Facebook, Twitter, Instagram, Sina and Tencent. The NBA was the first professional sports league to exceed one billion videos viewed on its YouTube channel and now has more than 1.3 billion videos viewed overall (according to nba.com).

LESSON 1.2

History of SEM


American viewers tuned into the European Championships 2013 Final in record numbers on ESPN, as the sport continues to grow in popularity in the U.S. The average viewing attendance for all 31 matches at Euro 2013 was 1.3 million, which represented a 51 percent increase on the numbers from the 2008 edition of the tournament.


LESSON 1.2

History of SEM


Also in 2013, Forbes reported that the Dallas Cowboys franchise was the most valuable in the NFL at $2.1 billion. In 2012, Forbes reported that the average NFL team is now worth over $1 billion over 250 percent more than when Forbes began calculating team values ten years ago and up 66 percent from just five years ago

The value of major league sport franchises continues to grow at a furious pace. In 1973, the late George Steinbrenner bought the New York Yankees for just under $9 million. In 2013, Forbes magazine valued the historic franchise at $2.3 billion


LESSON 1.2

History of SEM

Fandom is a term used to refer to a subculture composed of fans characterized by a feeling of sympathy and camaraderie with others who share a common interest



LESSON 1.2

History of SEM


The term fandom can be used to describe all types of fan groupings or “subcultures”


LESSON 1.2

History of SEM


Over 50% of respondents claimed to more of a sports fan than they were five years ago

ESPN’s annual “SportsNation Survey” found that a whopping 90% of male respondents claimed to be sports fans on some level


58% of respondents would prefer to receive free season tickets to their favorite sports team than be promoted at work. 40% of those participating in the 2012 SportsNation Survey said they had traveled 250 miles or more to attend a sporting event

LESSON 1.2

History of SEM


Fans have, in a limited number of occasions, successfully organized on behalf of a cancelled

television series to lobby networks to bring back their favorite show (examples include Chuck in 2010 and Community in 2012 while prompting

Netflix to resurrect cult hit series Arrested Development)


http://www.google.com/url?sa=i&rct=j&q=chuck+the+tv+show&source=images&cd=&docid=YL6jw38I4rZfwM&tbnid=0oDW-TwSSDhxUM:&ved=0CAUQjRw&url=http://www.scificool.com/category/chuck-tv-series/&ei=3Jf5UeiLMsGX2QWlqoHoDg&bvm=bv.49967636,d.aWM&psig=AFQjCNE_4DfOCnpxj5XJqb8SubWjPHIcuw&ust=1375398233317532

http://www.google.com/url?sa=i&rct=j&q=Community+the+tv+show&source=images&cd=&cad=rja&docid=EEk14Ls2vVwiwM&tbnid=Yqk-SaQHLU_UqM:&ved=0CAUQjRw&url=http://www.freetvchannels.ca/community-the-real-class-clown/&ei=G5j5UZC7CePs2wWXloHYAw&bvm=bv.49967636,d.aWM&psig=AFQjCNHvtLYbPBNl12pWSmj7KpjGwsVPgQ&ust=1375398292210842

LESSON 1.2

History of SEM


The intensity levels of fandom vary, ranging from a casual sports fan who might take in one NBA game per year to those fans that put the “fan” in “fanatic” (and otherwise engage in behavior that other fans might otherwise find to be irrational)


LESSON 1.2

History of SEM


Fans who go to extremes to show their loyalty to their favorite team, band, actor or other celebrity are often referred to as “superfans”


http://www.google.com/url?sa=i&rct=j&q=superfan&source=images&cd=&docid=S4XzsNW_ImFO6M&tbnid=ops3VyuN9S5KbM:&ved=0CAUQjRw&url=http://bostinno.streetwise.co/2012/08/29/why-do-people-hate-boston-sports-fans/patriots-super-fan/&ei=BJn5Ubj6GuP-2gX294HIDw&bvm=bv.49967636,d.aWM&psig=AFQjCNGdJPQd7EJQ7y8GR7uLq3eiHftBlA&ust=1375398510723637

LESSON 1.2

History of SEM


Self-proclaimed Clippers fan “Clipper Darrell” spent $12,000 customizing his BMW to reflect his love for the Los Angeles Clippers (complete with the license plate “CLIPERD”)


Darrell has gone so far as to have his own personal dedicated website

Because Clipper Darrell began charging people for public appearances, the Clippers franchise asked that he disassociate himself with the team in 2012. They would later sort the issue out and Darrell returned to his regular seats.

LESSON 1.2

History of SEM


A Washington Redskins superfan who goes by the nickname “RG3 Woman” dresses up in a gold bodysuit at home games to cheer on her favorite player


http://www.google.com/url?sa=i&rct=j&q=rg3+woman&source=images&cd=&cad=rja&docid=7rFvwl9ORr2ZgM&tbnid=dD5Zftzxq2Fb0M:&ved=0CAUQjRw&url=https%3A%2F%2Ftwitter.com%2FRG3Woman&ei=gXX-UcGOLeav2QWu74CQAg&bvm=bv.50165853,d.b2I&psig=AFQjCNGZmtrGNmXAGzMnzuyFMn42oZD1Gw&ust=1375717112246296

LESSON 1.2

History of SEM


In 2013, an Alabama football superfan passed away at the age of 91 but had attended 781 straight games

Also in 2013, a lifelong Cleveland Browns superfan passed away (his family even encouraged everyone attending his funeral wear clothes supporting the team) but requested that the pallbearers be Cleveland Browns players, stating: "He respectfully requests six Cleveland Browns pall bearers so the Browns can let him down one last time."


http://www.google.com/url?sa=i&rct=j&q=alabama+football&source=images&cd=&cad=rja&docid=tTG7GQJG_c7woM&tbnid=VZs-1Syi_wm55M:&ved=0CAUQjRw&url=http://capstonereport.com/2011/08/05/alabama-football-nick-saban-blasts-irresponsible-media/12881/&ei=H6r5Ua7pOuS82wWgg4DIDg&bvm=bv.49967636,d.b2I&psig=AFQjCNGauK5lvydnd-ScAx7s0p-B9T47Dw&ust=1375402907510131

http://www.google.com/url?sa=i&rct=j&q=cleavland%20browns&source=images&cd=&cad=rja&docid=yJmzhAn5nQLu5M&tbnid=NpF9j03fZJ9jXM:&ved=0CAUQjRw&url=http://nfl-franchises.findthedata.org/l/23/Cleveland-Browns&ei=_ar5UbiwG-TB2QWLyYCYCQ&bvm=bv.49967636,d.b2I&psig=AFQjCNERvJ8k4BgOaHAktlJplhiNDoa4MQ&ust=1375403123363129

LESSON 1.2

History of SEM


Fandom explains why people propose at sporting events or feature a themed wedding centered on their favorite sports team


http://l3.yimg.com/bt/api/res/1.2/AmEfc4VQP2fgVy93WeCIWg--/YXBwaWQ9eW5ld3M7cT04NQ--/http:/media.zenfs.com/en/blogs/sptusnflexperts/d0611ss.jpg

LESSON 1.2

History of SEM

Signs of Continued Industry GrowthOn opening night, Activision says that approximately 1.5 million gamers lined up outside 13,000 stores to buy a copy of Modern Warfare 3 at midnight

USA Today published a story suggesting the number of people calling in to work sick the day after Call of Duty is release results in a significant increase

In 2013, University of Kentucky fans paid between $7,500 to $12,500 for the opportunity to attend a basketball camp (called John Calipari Basketball Fantasy Experience) and “essentially experience what it’s like to be a Kentucky basketball player”


LESSON 1.2

History of SEM


The existence of fandom is what ultimately fuels today’s non-stop, around the clock media coverage of celebrities and sports stars and drives a culture in which athletes and celebrities are often quickly forgiven for highly publicized transgressions when they perform


LESSON 1.2

History of SEM


Four years after dropping Michael Vick as a product endorser, Nike re-signed the star quarterback to a

new deal in 2011 after his play on the field and public appearances helped him to rehabilitate his image


LESSON 1.2

History of SEM


While many media pundits publicly chastised LeBron James’ decision to announce which team he would be

joining in a one hour ESPN special, the show (aptly named “The Decision”) drew very high ratings as

nearly 10 million people tuned in to watch


LESSON 1.2

History of SEM


Despite all the scrutiny surrounding singer Chris Brown (including his widely publicized assault of then-girlfriend Rihanna, a disturbance in a nightclub with

rapper Drake, and poor album reviews), his 2013 release of “Fortune” managed to debut at the top of

the Billboard 200 chart


LESSON 1.2

History of SEM


Because of the strong emotional connection

fans maintain with their favorite sports teams, wins and losses on the grandest of stages can

yield incredible influence (both positive and

negative) on a community at large


LESSON 1.2

History of SEM


After struggling with one of the worst national disasters in US history (Hurricane Katrina), fans in the New Orleans area often cited the New Orleans Saints Super Bowl win as an

inspiration for the city’s resurrection


LESSON 1.2

History of SEM


Representing their country just four months after a devastating tsunami rocked Japan, their women’s

soccer team pulled off one of the greatest upsets in sports history by defeating the heavily favored

Germans in the 2011 World Cup and, ultimately, beating the United States in the championship game.

“Our playing is to be an encouragement for the victims of the disaster,” said Coach Norio Sasaki after

the monumental victory while the headline in the New York Times the following day read: “A Resilient

Team Soothes a Nation.”


LESSON 1.2

History of SEM


On the flip side, after beating the Detroit Tigers in the 2012 World Series, Giants fans turned

destructive in celebration in downtown San Francisco, including setting fires and rioting

Violence also erupted on the campus of Penn State in 2011 after students (fans) learned of the

school's decision to fire legendary football coach Joe Paterno in the wake of the now infamous child

sex abuse scandal


LESSON 1.2

History of SEM


Fandom can, unfortunately, also result in an unhealthy (and potentially dangerous) subculture of fans that become too emotionally invested and obsessive with their favorite sports teams or celebrities.

In 2012, a man was sentenced to serve time in prison after he broke into rap mogul Sean “Diddy” Combs’ vacation home in the Hampton and reportedly ate food, drank soda and went to sleep in an upstairs bedroom. The suspect, who told police he "was actually hoping to stay like 15 to 17 days”, was also ordered to stay away from Diddy's house for at least five years.


LESSON 1.2

History of SEM

Signs of Continued Industry GrowthAfter being knocked out of the 2013 NBA Playoffs, Chicago Bulls fans who were disappointed that star point guard Derrick Rose was unable to play that season due to injury took to Twitter to voice their displeasure. Moments after the team lost, #DerrickRoseMoreUselessThan started trending nationally on Twitter.

An Ohio State fan, after learning that a high school recruit announced his decision to attend rival school Michigan by posting a photo of the player burning a recruiting letter from Ohio State, pledged on Twitter to pay "$2,000 to whoever sidelines this kid permanently.” He would later apologize and offer to donate the money to the University of Michigan.


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