Sports Economics and Marketing

On how professional sports are run and how that business cycle operates

All classes of Arjun sir have been very interesting and today was no exception. This time we learnt about how the business cycle in a professional sport operates. This was studied under the case study of IPL (Indian Premier League). First of all, there is an association which runs the league like the IPL Governing Council under BCCI. This association is broadly required to perform the following functions.

1. Frame the rules of the competition.
2. Look after the salaries and the working conditions of the athletes.
3. Arbitration ie settle disputes arising during the competition.   

Further we learnt about the various revenue streams which could be as follows:

1. Franchisee Fees
2. Broadcasting Rights (TV, mobile, internet,etc)
3. Sponsorship Fees

Then we learnt on how such athletic events can be organised to earn profits. This included having exclusive stadium rights by the club itself rather than leasing them out from the state authorities. This will help a club to model or design the stadium according to its own team culture and give it a new identity. A stadium can include a multiplex system ie having a bar, lounge, marketplace to generate revenue other than the gate receipts, sponsorship hoardings,etc. Such a sports property has although not yet been made in India.