Changes Coming to Your Favorite Sports in America?

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With the economy on a downward spiral, American sports are lying in its path.

 

Just this week, Buick, a major cooperate sponsor of Tiger Woods announced that they would be terminating their contract. No, not because Woods wasn’t performing at a level they expected or because of an off course incident that somehow defamed his name and could be tied with the sponsorship. This was based solely on the economic condition of Buick and its parent company General Motors. But don’t worry; the estimated 7 million dollar payout won’t affect Tiger. But this situation, just sites a source that will have a trickle down effect.

 

And this effect will be felt in many ways. Like Buick, many cooperate sponsors will start to cut costs and marketing is one of the easiest ways. Stadium advertising, commercials, and player endorsements will start to be scrutinized as efforts to eliminate unnecessary spending continue.

 

To compensate for the lack of cash flow, sports organizations will have to produce revenue or cut their costs in two ways. The first, start to tame the contracts some professional athletes receive. But it won’t start at the top. Many middle to lower echelon players will probably have to absorb most of the financial burden that teams face. There’s no doubt the big name players will still get their 100 million dollar plus contracts. The second and probably least popular is raising the cost for fans to attend games. This increase will have the obvious outcome that you’re thinking. Fans won’t be as free willing to shell out hundreds of dollars just to see their team play, and will start staying home.

 

College fans, expect Universities to start to eliminate sports that draw heavy burdens on already strained budgets. If you haven’t seen or heard a University budget sheet on the sports they have and the revenue they make or lose, it would drop your jaw. Unfortunately it’s not cheap to operate these teams. Very few sports around the country actually make money for their universities. It is mostly football and men’s basketball programs. Other than that they’re all heavy losses.

 

While it’s not clear, how long this economic downturn will last, or how much of an effect it will have long after a recovery begins, it’s apparent that sports in America will not be spared by its fury. Sports are not “recession” proof. Player contracts, again for the middle and lower athletes, will diminish. Owners will look for ways to keep generating revenue. Fan’s will be forced to make the decision of whether to pay the electric bill this month or watch their team for a couple hours. Corporate sponsors will be faced with the decision to pay multi-million dollars in marketing contracts or lay off thousands to save costs. And Universities will have to make budget considerations about how much money they can lose before a sport is cut from funding.

In any case, none of these decisions will be easy. Everyone will see a continued effect on the way sports are played, operated and watched.Â