Negative Impact of rising ticket prices and player salaries on sports Essay

Thesis statement:

            The paper gives an introduction of how rising ticket prices and player salaries have played their role in the decline of sports - Negative Impact of rising ticket prices and player salaries on sports Essay introduction. The research further goes on to explain, in detail the effects caused by the two listed factors on sports. The first part of the paper outlines the independent effect of rising ticket prices alone on sports, whereas the second half outlines the effect of high player salaries independently on sports. Finally, it links both aspects together and examines their cumulative effect on the sporting world.

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Introduction:

With rising ticket prices and player salaries, sports on the whole have suffered a major blow. A few years ago, sporting events were staged for the fanfare, the excitement and the emotional appeal it generated amongst the masses. The inclusion of money directing games and players has taken away the essence of sporting events and the emotional significance that fans attached to players and their clubs (Kesanne, 2007). With money playing an important role in the lives of club owners, players and sponsors, sporting events have seen a downfall in their receptivity (Kesanne, 2007).

Irregular raise in ticket prices with inflation:

Sporting firms such as the PGA, NFL, EFL, etc, generally attribute their raise in ticket prices on factors such as rising oil prices, the high lease values, player salaries and other essential items that have increased in price. However, how much truth lies in this argument is questionable. The EFL increased ticket prices by 9.6 %, while the consumer index increased only by 4.6%. This shows a threefold increase from what is the general inflation level resulting in clear profits to the firms involved in charging high ticket prices. These claims, whether being refuted or not, have surely done damage to the sporting industry all over the world.

Declining fan base:

The negative impact played by rising ticket prices and player salaries has been immense. The first fallout from the increases has been the decrease in fanfare of sports itself. Sports are now not judged on the level of abilities that are being displayed or the essence of competition that is being played, but rather what the award money for the event is (Zimbalist, 2006). The fanfare has drastically reduced with fans shelving out little for tickets at major sporting events. With the high rising prices, more and more fans seem left out of the loop due to financial constraints. The matter is not isolated to the lower segments of society but it has also started pinching the more affluent class. Rising ticket prices have taken their toll on fanfare of all events. More and more sports leagues are finding it hard to generate the fan base that once was and stadiums are often left with empty patches. The damage is immense. People might be interested in sports, but their lack of commitment to the atmosphere has resulted in damaging major events. Many international events, including the 2012 Olympics, to be hosted in London, have decided to decrease their general lavish expenditure that only made the sport more interesting (Kesanne, 2007). Furthermore, with fan base decreasing, the interest of sports is dying out. More people have moved on to other recreational activities. This is caused a downward spiral in many directions. One, young children are no longer being socialized into healthy living and people are moving towards other unproductive forms of recreation such as having a drink in a bar. The development of physical health has taken a U-turn and instead of playing sports in real life, many are turning to Nintendo Wii, and other gaming consoles. This further exasperates the situation as clubs find it hard to sell their merchandise to the general public.

The link between sponsors and rising ticket prices:

The fact that audiences are no longer attracted due to the high ticket prices has laid an impact on possible sponsors to global events too. Sponsors no longer see the need to invest in teams; stadiums or other such expenditure due to the lack of marketing opportunities the new situation has created (Kesanne, 2007). Sponsors would usually invest in the hope of generating favorable public relations with the fans, or a form of public relations. In other words, a reputation amongst the diverse crowds present at the stadium (Zimbalist, 2006). However, with stadiums filled with empty seats, sponsors find it more convenient to invest somewhere else. This development has further damaged sports as sponsors were the main source of the sporting industry’s income. Without sponsors, the clubs cannot dream of decreasing ticket prices, let alone retaining players. With sponsors backing out, clubs can expect heavy economic turmoil as they have to meet their costs elsewhere. The hype created by the marketing strategies employed by the sponsoring firms will also decrease (Zimbalist, 2006). The dying hype will take along with it any potential niche market still available to be captured. The fanfare, the glamour, the publicity and of course the extravagant lifestyle that consumers generally enjoy in sporting events will all die too leaving behind a weakened atmosphere of sporting events. The events will become dull, unattractive and seemingly mundane to the general public. The emotional importance, the deep connection that people establish with sports, especially the male segment of society will decrease. As explained earlier, consumers will shift to some other form of recreation.

Global financial crisis:

            The sporting industry has also been plagued by the financial crisis. For example, 17 out of the 47 PGA events scheduled in 2009 were sponsored by the financial sector. These firms are slowly backing out or are decreasing the amounts that they had promised due to the incredible credit crunch and shrinking global economy. This has further hurt sports as ticket prices have risen as a result of lack of money. Initially, these financial institutions would be the soft corner for all sporting events. They provided a cushion for major event organizers and club owners who could decrease prices of tickets through them to increase attendance (Zimbalist, 2006). However, with their patronage in question, sports has not pillow to fall on. If the industry takes a fall towards rock bottom, it will collide head on with no room for comfort. There is fear that the financial crisis will subjugate sporting events across the globe to a bare minimum and that too with no room for support to enhance crowds by decreasing ticket prices (Zirin, 2005).

The social fabric of society:

Sociologists view sporting events in the form of a community building. When large masses get together it bonds them. Civic pride and identity is created with large sporting events (Lampman, 2006).  According to john Walsh, senior vice president, ESPN, sporting events now create the cultural and social landscape of America. This shows the relevance of sporting events in the lives of people (Schmidt, 2006). However, with the increase in ticket prices, and less people attending such events, a lot of positive factors that come through sports will die down (Rosner, 2004).  A U. S news survey revealed that 91% people think that sporting events at a large level help integration of various ethnic communities and racial groups. While the same sample showed that 84% think sporting activities help grow business across the country and are good for developing economies. 77% people went on to claim that sporting events helped parents be better nurturers for their children (Lampman, 2006). This fact is widely acclaimed as parents generally try to pass on their experiences to their children and hope that their children will learn just like they did.  And finally, 68% believed that sporting events helped them get along with members of the opposite sex. This shows that sports not only captivated audiences but also left great room for the development of personalities and human relations (Lampman, 2006). However, with an average family of 4 paying approximately $250 on an average game per week, the likely hood that more fans will come to the stands is bleak. With less attendance at major events, the social fabric that sports provides a community will crumble with time (Schmidt, 2006).

Substitutability in the form of TV channels:

            The essences of sporting events have been live matches. Live matches always attract more fanfare than television shows. People would go to watch games live for the sake of entertainment, the atmosphere and the experience. However, with cable operators and other sports networks, a substitute has been provided to fans who cannot afford to go. Television coverage often delivers the same actions in a person’s TV lounge compared to a live match. This factor of substitutability has given a chance to consumers to watch games at home rather than pay hefty amounts of money to go to a stadium. What this does to sports is significant. The fact that people are now shying away from stadiums means that people going to view live sporting matches will eventually lead to a decline (Ross, 2008). This takes downfall complimentary goods attached, such as the taxes paid to governments, sponsors, refreshments bought at the stadium, club merchandise, etc. but most of all, it takes away the experience of being at a live game that people who have witnessed, cherish (Schmidt, 2006). The fact that it takes away the ability for people to learn, share and grow with sports dents the future of sport recreational immensely. It is like saying that people would rather record a lecture and listen to it later, then to attend it themselves and interact with the forces that drive the lecture. This will inhibit mental growth and physical growth of the masses and lead to the decrease of the essence of sports; physical recreation.

Rising player salaries:

            The issues of rising player prices have raised questions amongst the minds of many audiences. People are now rising up against the manipulated capitalist culture and the money driven sporting world (Rosner, 2004). Many consumers feel that it is unfair that players are often being paid more than Presidents of major nations. They feel it unfair that the players demand such high prices for such few games. Most of all, they detest the fact that those costs are further driven down to the consumer who pay the bill for the extravagant lifestyle that the player in question enjoys (Schmidt, 2006). Many have started questioning the coined phrase used by many athletes; “it’s all about the fans” (Rosner, 2004). They claim that if it’s the fans or the nation or the club that athletes play for, the charging of phenomenal ticket prices just to meet their salaries is unfair. The sporting world has now achieved a very hypocritical culture in the eyes of a genuine fan. More and more people feel that they are being taken advantage of by top conglomerates who own teams. They argue as to why they should pay $100 to an already existing billionaire (Ross, 2008). The culture of greed and profiteering has turned away many genuine fans from many players (Ross, 2008). This has tarnished the image of sports which initially bought people together. Players did not play for money. They played to represent their community, their country and their cultures. The element of fair competition is decreasing day by day and at the same time decreasing the fanfare that came along with sports (Zirin, 2005). The richest owner can buy the best player. The richest club can accumulate the best players. This accomplishes only one thing. The EPL lost a lot of its viewership because teams had monopolized such strength through the talent acquired by funds that it is a known fact that out of all the teams participating, the likely winners will be one of 3 particular clubs. The element of competition has died and people have lost interest in sports because of that. The mentality that sports enjoyed, the respect, the integrity and the fanfare that sporting personalities had, has vanished to a great extent. Players now play for money alone and go to the highest bidder (Kesanne, 2007). This has left a dark mark on the image of sports and sporting events. A recent survey conducted in Canada revealed that 55.3% of the sample regarded athletes with lower esteem due to their high pay scales.

Disenchantment with sport personalities:

            In essence, it is widely believed that sports are an active participant in developing culture and human personalities. With sports being transformed into business, moral degeneration is a cause of worry. In terms of business, profit is the key to survival. And if profit is the only thing that is kept in mind when hosting events that have such profound effects on the social fabric of society, degeneration is very possible (Zirin, 2005). Money is promoted as an underlying factor for success; young fans are enticed into a new breed of culture. A culture that promotes self interest alone has degraded the moral framework of our society and the high salary scales have the tipped the scales in the same direction. The role models being portrayed are eventually leaving the general public disgruntled and decreasing the fan base of sporting events. People have begun to question the idea how an athlete can be paid $100,000 a week while a certified doctor who saves lives of many is paid much less ( Wann, 2001). Many people also claim that when a substantial number of people are dying across the world from hunger, lack of disease research and other basic necessities of life such as water, what justifies the increased spending on athletes in such a way? Such ideas and notions are pushing people away from the essence of the games being played.

Abuse of salaries by players:

            Another valuable piece of evidence to hit the sporting industry is the use of money by athletes for drugs, gambling and other illegal activities that spoil their name and the name of sports. Many athletes have engaged in activities such as gambling and drugs after earning large sums of money. Research has confirmed that most athletes with large pay scales indulge in such activities perhaps because of the “nothing to lose” idea since they already have so much. Such factors have contributed to the degradation of the tradition of sports and also the value attached to them. People find it objectionable to pay such high rates for tickets when the money is going to be spent on salaries of players which will eventually be abused (Kesanne, 2007). Sporting events have lost out on a lot of customers and potential viewers because of this phenomenon.

The link between rising ticket prices and increase pay scales of players:

            Finally, the link between player’s pay scales and high ticket pricing is quite close. Many clubs and organizations claim that the charges that they make in the form of higher ticket prices are used to finance player salaries (Dowbiggin, 2007).  To a certain extent that is true. Many of the global clubs have their top costs as their player’s salaries. Other expenses are often peanuts of the salaries they dish out to their top ranking players. Others claim that the amount invested in high ranking players that guarantee wins and attract crowds justifies the increase in ticket prices and to retain such talented players in the industry, they have to do increase prices to meet their costs (Howard, 2003). Fans on the other negate this argument as useless. They claim that if players play for their fans and with the amount of such heavy sponsorships available, there is no reason that such costs should be transferred to consumers( Wann, 2001).They also claim that when it comes down to stadium constructions, a majority is subsidized by tax payer money. Claiming that the national exchequer is the right of every citizen, the ticket prices should be subsidized since technically every citizen has invested in the stadium that they are charging for (Wann, 2001).

Conclusion:

The argument goes both ways but in the end the loser is the sports industry and the diehard fans who just want good action every other week. Fans have become disillusioned with their stars and companies have laid their emphasis on bank rolling funds alone. The essence of the game has been lost.

References:

Dowbiggin, Bruce (2007). Money Players: The Amazing Rise and fall of bob Goodenow and the NHL Players Association. Key Porter Books

Howard, Dennis (2003). Financing Sport. Fitness Information Technology

Kesanne, Stephen (2007). The Economic Theory of Professional Team Sports: An Analytical Treatment. Edward Elgar Publishing:

Lampman, Brian (2006). Learning Culture through Sports: Exploring the Role of Sports in Society. Rowman & Littlefield Education

Rosner, Scott (2004). The Business of Sports. Jones and Bartlett Publishers

Ross, Stephen (2008). Fans of the World Unite! A (Capitalist) Manifesto for Sports Consumers. Stanford Economics and Finance:

Schmidt, Mike (2005). Clearing the Bases: Juiced Players, Monster Salaries, Sham Records, and a Hall of Famer’s Search for the Soul of Baseball. HarperCollins:

Wann, Daniel (2001). Sport Fans: The Psychology and Social Impact of Spectators. Routledge

Zimbalist, Andrew (2006). The Bottom Line: Observations and Arguments on the Sports Business. Temple University Press:

Zirin, Dave (2005). What’s My Name, Fool? Sports and Resistance in the United States. Haymarket Books

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