Business, physical activity and sport

1. Sport for fun and sport for profit

Learning goals We are learning to distinguish between amateur and professional sport. We are learning the difference between ‘sport for sport’s sake’ and sport as a profit-seeking venture.

Professional athletes Professional athletes are ones who are paid to compete in a sport for example, in the NHL (hockey), the NBA (basketball), the PGA (golf), the ATP (tennis), and many other professional sports.

Amateur athletes typically play mainly for personal enjoyment and prestige. are not paid to compete full- time. often rely on government support for part of their training.

Amateur vs professional divide essential difference compensation. pro athletes are employees doing a job to earn money. compensation consists of a player’s contract, signing bonuses, sale of merchandise and tickets, investment opportunities, and endorsement deals. endorsement deal is an agreement whereby an athlete is paid to promote a product or service provided by a commercial interest.

Semi-professional athletes an athlete’s career could also be a blend of professionalism and amateurism. top amateur athletes usually want to move up to the “big leagues” where financial rewards are plentiful. many sports organizations have relaxed their rules so that professional players can compete, e.g., Olympic hockey and basketball.

Funding for amateur athletes Sport Canada is Canada’s major granting agency. athletes funded through Athlete Assistance Program. an athlete must be in the top-16 in the world in his or her event, or be deemed to have the potential to achieve this ranking. gives between $4,500 and $18,000 per year to individual athletes to help pay for living, training, and travel expenses.

Amateur athletes financial challenges normally do not have lucrative endorsement deals. often must train while maintaining a full- or part-time job. typically have to pay for their own coaching and travel to events. If they are lucky (and good), they can get some support from Sport Canada (but that barely covers living expenses).

For-profit sport organized sport where owners hire players to compete and then the owners market their athletes objective for the owners to make financial return on investment sport becomes a business

Not-for-profit sport recreational, community, and national-level sport where the primary objective is enjoyment and representing one’s country. costs money and sometimes there are local businesses that may sponsor e.g. the local Tim Hortons – hockey primary objective is not for profit; players are not paid. no money is made.

For-profit sport and revenue streams sale of tickets to games is only the starting point for sports income sale of rights to media coverage of an event rights to manufacture replica products (e.g. T-shirts and mugs) sales of advertising on television broadcasts increased revenue means a team has more money to hire superstars.

Endorsements and sponsorships some athletes endorse the kinds of products they use in training and competition (e.g. basketball shoes, baseball bats, or sports drinks) sports celebrities also appear in ads for products unrelated to sports (e.g. donuts, smartphones, or fast food) Michael Jordan began a new trend in athlete endorsement: he became the first of many athletes to earn more from endorsements than from salaries. Nike Videos

Professional teams – sport spinoffs replica products: team jerseys, coffee mugs, supporter banners, scarves, etc. food and beverage sales at stadium concessions alternative uses of sports stadiums (concerts, trade shows, amateur events) sponsorship of charitable activities by sports teams can increase gate receipts. contributions to local economies (taxes, tourist attractions, jobs)

Revenue of sport clothing

summary Professional athletes are paid to compete; amateur athletes are not. Professional athletes earn money from salaries, endorsement deals, signing bonuses, sales of merchandise and tickets, and investment opportunities. Amateur athletes receive relatively modest government funding. Professional sport is a huge profit-making enterprise that relies on various revenue streams and spin-off ventures.

Learning goals We are learning to distinguish between amateur and professional sport. We are learning the difference between ‘sport for sport’s sake’ and sport as a profit-seeking venture.