20 Apr Potential In-Game Revenue Losses Ahead Once Sports Return to Play
Many people around the world have shared unforgettable moments in stadiums packed to the brim with fans. The game-winning play or heartbreaking loss, we all have experienced this along with 50,000 or more random people. But what if that same immaculate experience we were all accustomed to, is lost?
COVID-19 has catastrophically impacted the sports industry just within a few months. Speculations about the future of sports have been floating around for some time. Recent substantial evidence suggests the changes ahead could last longer than the short-term.
According to a new poll published by Seton Hall at Stillman School of Business, 72% of Americans said they would not attend games without a vaccine present for the coronavirus. Furthermore, only a small portion of the respondents was found to express feelings of safety at 13 percent. If league play were to resume with fans in attendance, many sports teams could expect a far lesser turn out of fans in light of Seton Hall’s new poll. This will significantly impact sports teams and their venues as some rely on ticket sales as a revenue stream.
To put it in perspective, the Golden State Warriors were estimated to generate $3.5 million per game according to NBC Sports. In terms of a league-wide perspective in the NBA, losses could be more sizable. According to NBC’s NBA Insider Tom Haberstroh, the NBA nets an average $1.2 million in ticket revenue per regular-season game, and a massive $2 million per playoff game.
Other leagues around the nation would also feel the repercussions. The MLS is considering a return, faster than the original May 10th date according to Sports Business Journal’s Mark J. Burns.
If the MLS were to resume league play in accordance with CDC guidelines, fans would not be present. In turn, this would cause MLS to lose pools of money. ESPN estimated the loss to be $1.5 million per game in reference to 2019 data.
While this may affect in-game revenue, broadcasters can see a light at the end of the tunnel and expect many to tune-in to empty stadium events. Dr. Anthony Fauci, the United States’ lead infectious disease expert has speculated that sports can return this summer. As previously covered, broadcasters are estimated to lose millions in ad revenue without live sports. If this were the timeline for return, broadcasters and brands with major ad deals can rejoice, while venues and leagues may lose millions in revenue.
What does this mean for brands? Sports fans everywhere are on the edge of their seats, waiting for live events to return. With sports potentially returning soon, there can be a large influx of television viewership. In the meantime, even esports are netting nearly a million views on some events. Not only does this present opportunities for the growth of brand awareness, but ad revenue will largely come back in.
