How Big Can the Professional Sports Industry Get?

Home Business Magazine Online

In the 21st century, professional sports are as much a business as they are a form of athletic competition. Events, tournaments, and leagues are put on, in large part, to make a profit for those taking part and involved in organizing them.

Those profits are hefty too. The NFL is the biggest and richest sports league on the planet, making its numbers the most impressive. From domestic revenues alone, the league raked in a total of $11 billion in 2021 from television broadcast rights, sponsorship deals, and royalties.

That figure rises to $17.19 billion when you factor in international income streams, including foreign TV agreements, the league’s streaming service, and advertising contracts.

All other major US leagues generate a great deal of cash too, including the NBA which passed through the $10 billion mark for the first time in the 2021/22 season.

For just about every major competition like this, revenues have been steadily rising over the last few decades.

But can we really expect this trend to continue forever? Of course, the natural economic forces of inflation will always make revenues bigger over time, but is real-term growth achievable and sustainable or will it eventually reach a plateau?

sports betting

One of the biggest areas of growth in the sports industry in recent years has been in sports betting.

This expansion has been seen most notably in the United States after a Supreme Court judgment in mid-2018 permitted individual states to set their own rules relating to this industry.

In the years that have passed since, around half of US states have legalized sports betting, leading to sportsbooks scrambling to build market share in those areas. This has led to the need for sites like OddsCheckerwhich help consumers cut through the noise to compare bookies and find all of the best free bet promotions offered by them.

And with half of the country still to fire the starting pistol on the race for sportsbook supremacy within their borders, as well as the fact that all existing states are enjoying explosive growth in this market, it’s clear there’s a lot of room for the industry to keep expanding.

international expansion

Most North American sports leagues operate almost exclusively on North American soil. While they do have fans abroad, they are not even close to maximizing the potential that comes from engaging the overseas market.

The same is true for sports from other parts of the world too. The English Premier League has, perhaps, done the best job, but it and its teams are still investing heavily in expanding into Asian and Middle Eastern markets.

Even international sports like Formula 1 still have underserved regions that can provide a lot of growth. This is why the sport has recently added two additional Grands Prix in the US to its calendar, so that it can appeal to fans there.

The way this international expansion is achieved varies from sport to sport and country to country. In the case of the NHL, NBA, and NFL, this is being achieved by hosting a small number of games in other nations, including the UK, Germany, and Mexico, for example.

Photo by Antoine Schibler on Unsplash

A focus on the show

There isn’t a single type of sports fan. Some are diehard enthusiasts, some are casual fans who watch from a distance, and some are only interested in the spectacle and the entertainment.

Catering to diehard fans is easy but engaging the other two categories is more complicated. Sports leagues are getting to grips with this, though, which is helping them to grow viewing figures, match attendance, and merchandise sales.

The NFL is a great example of this. Its playoff final, the super bowl, is watched by one-third of the US population and many more people around the world. The vast majority of these don’t pay attention to the league for the rest of the year.

The reason it can command such high levels of attention is because the modern Super Bowl represents a large-scale entertainment package replete with live performances and other festivities.

This is being replicated by other leagues and tournaments too, almost always with positive results.

Overall, it is clear that there is a lot of room for professional sports to expand. It’s difficult to say exactly how big they can grow but the current figures of up to $17 billion will likely look miniscule in a few years.

the post How Big Can the Professional Sports Industry Get? appeared first on Home Business Magazine.