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chapter
5
Professional Sport
James M. Gladden, William A. Sutton
Introduction
• Professional sport is any sport activity or
skill for which the athlete is compensated
• Compensation can be in the form of a
salary, bonuses, reimbursement for
expenses, or any other forms of direct
payment
(continued)
Introduction (continued)
The heart of North American sport
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Super Bowl
World Series
Masters
Indianapolis 500
Wimbledon
Kentucky Derby
X Games
Nature of Professional Sport
• David Guterson (1994)
• Professional sport industry principles
– Labor
– Management
– Governance
Unique Aspects of Professional Sport
• Interdependence
• Structure and governance
• Labor–management relationship
• Role of electronic media
Interdependence
• Teams simultaneously compete and
cooperate
• All teams make sacrifices and concessions
for the long-term benefits and growth of the
league
• Each league pools its revenues to some
extent
Structure and Governance
League office includes
• League commissioner
• Board of governors composed of team owners
• Central administrative unit
– Negotiates contracts and agreements
– Responsible for scheduling, licensing, and so on
– Coordinates publicity and advertising
Labor–Management Relationship
Five unique circumstances and conditions
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Baseball’s antitrust exemption
Collective bargaining
Free agency
Salary caps
Player draft
Baseball’s Antitrust Exemption
• Sherman Antitrust Act
Created to prohibit companies from dominating their
respective markets in interstate commercial activity,
thus creating a monopoly
• Supreme Court ruling
– Federal Base Ball Club of Baltimore, Inc. v. National
League of Professional Base Ball Clubs (1922)
– MLB was granted an exemption to antitrust law
Collective Bargaining
• National Labor Relations Act (NLRA)
• Common elements
National Labor Relations Act
Provides three basic rights
• Right to self-organization—to form, join, or assist
labor organizations
• Right to bargain collectively through agents of one’s
own choosing
• Right to engage in concerted activities for
employees’ mutual aid or protection
Common Elements
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Contract
Compensation
Labor
Rights
Agreement
Clauses
Protection
Benefits
Discipline
Free Agency
• Implications
After fulfilling number of years of service with a team,
players can sell their services to another team
• Restrictions
– A negotiated item in the collective bargaining
agreement
– Recognizes team investment in the player
Salary Caps
• Labor and management share revenues
generated by the league
• Places limit on total compensation
• All teams must comply
• Put into effect through collective bargaining
Player Draft
• Designed to be an equitable system
• Teams with poor records have an advantage over
teams with winning records in acquiring talented
new players
• Teams restrict competition for new talent
• Team that drafts a player determines destination
and salary of new player
Role of the Electronic Media
• Importance of television
– Teams and leagues receive revenue
– Enhances the enjoyment for viewers
• Emerging sources of media coverage
– Satellite
– Internet
Revenue Sources
for Professional Sport
• Media contracts
• Gate receipts
• Licensing and merchandising
• Sponsorship
Media Contracts
• Table 5.3
National media contracts for sport leagues
• Proliferation of sport programming
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Growth and capabilities of both cable and satellite
Increased choices available
Decline in viewers of professional sports
Difficult for leagues to negotiate lucrative contracts
Gate Receipts
• Major source for minor league sports
• Prevalent source for newer leagues
• Majority retained by home team
• Portion given to league
• Portion may be given to opposing team
Licensing and Merchandising
Revenues
• Leagues and teams grant manufacturers the
right to use names and logos
• In return they receive a royalty
• Lucrative source of revenue
• Revenues distributed equally among teams
Sponsorships
• Signage
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Becomes visible
Demand for location
Rotating signage
Virtual signage
• Naming rights
– Corporation agrees to pay a large sum of money
– Name of corporation included in the name of the
facility
Career Opportunities
• Executives
Overseers of the entire operation
• Player personnel
Responsible for putting the best possible team on the
field or court
• Business positions
Responsible for generating revenue, marketing,
developing a fan base, and working with customers
Executives
• Chief executive or operating officer
Responsible for entire organization
• Chief financial officer
Responsible for accounting and financial planning
• Chief marketing officer
Responsible for coordinating marketing mix
(continued)
Executives (continued)
• General counsel
Responsible for overseeing all legal matters
• General manger
Responsible for acquiring, developing, trading, and
releasing talent
Player Personnel
• Involved in identifying, evaluating, and
developing potential and current players
• Involved in observing players assigned to
the minor leagues
Medical, Training, and Team Support
• Responsible for physical and mental
preparation and readiness of players
• Responsibilities include
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Medical and dental care
Treatment and rehabilitation
Nutrition
Strength and conditioning
Coaching Staff
• Concentrates on all activities occurring
between the lines
• Primarily concerned with coaching,
managing, and training players on the
rosters
Player Education and Relations
• Serves as a liaison between team and player
• Educates players regarding
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Financial management
Substance abuse
Nutrition
Image management
Additional higher education
Video Staff Support
• Produces and edits videos
• Purchases and maintains hardware and
software
• Supervises and coordinates satellite
feeds
• Coordinates broadcasts
Equipment and Clubhouse Staff
• Maintains, cleans, orders, repairs,
distributes, inventories, ships, and packs all
uniforms and equipment
• Negotiates with manufacturers and sales
personnel for equipment and uniforms
• Provides security for the locker room both
at home and on the road
Stadium and Facility Staff
• Responsible for maintenance, upkeep, and
repair of the playing surface
• Prepares the team offices, locker rooms,
training facilities, practice facilities, and
playing fields
Ticket Sales
Focuses on selling
• Season tickets
• Partial season tickets
• Group tickets
Corporate Sales
• Targets corporations exclusively
• May sell corporate sponsorships, luxury
suites, or club seats
Game Experience
• Focuses on enhancing the experience of
people who attend games
• Oversees music, video boards, and public
address messages
Advertising
• Designs and writes advertising copy
• Identifies, secures, and places
advertisements in a variety of media
Promotions
• Focuses on providing an optimal
experience to spectators
• Oversees all promotional activity that
occurs on the field or in the stands
Web Site Management
• Uploads and downloads content
• Works with league offices to ensure
appearance standards
• Works with corporate sponsors
• Creates content that will increase traffic to
the site
Community Relations
• Creates and administers grassroots
functions
– Clinics
– Charitable events
• Implements leaguewide programs, such as
NBA Reads program
Media Relations
• Assists and works with the media by
providing information necessary for game
and publicity
• Ensures that the needs of the media are met
at every sporting event
• Responsible for media guides, yearbooks,
and game programs
Database Marketing Coordinator
• Focuses on building databases of
information about team customers
• Oversees the marketing research efforts of
the organization
Hospitality Coordinators
• Responsible for game-related needs of
– Corporate clients
– Club seat holders
– Luxury box owners
• Coordinates the provision of
– Food
– Beverages
– Computer and Internet connections
Information Technology Staff
• Responsible for information technology
hardware and software used in all
operations of the franchise
• Handles purchasing, network maintenance,
and report generation.
Ticketing
• Manage the ticket inventory
• Responsible for
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Ticket distribution
Printing
Accounting
Box office sales
Complimentary tickets
Financial settlement for visiting team
Securing Employment
Steps that you can take
• An internship is essential
• Construct an information file on teams and
organizations
• Seek part-time employment or volunteer experience
in sales, game management, customer service, and
hospitality
• Interview people
• Develop good understanding of the industry,
leaders, and issues