“Show me the Money!”: Sport, Leisure, and Tourism Marketing MKTG.4320 Fall 2008 ©Detlev Zwick, Ph.D.

Attention Economy

The Beckham Effect

The Cost $250m for 10 years –Base salary of $6.5m –Cut on merchandise, gate receipts, sponsorship revenues

The Payback? The Gate: General admission rises from $15 to $25 Sideline seats from $50 to $75 Sideline Season tickets went for $4000 a piece and sold out mere 3 weeks after the announcements Ticket revenue increase : from 6 to 10 million

The Sponsorship Ticket: From $3.5m to about $9m a year. Herbalife with a $20m/5 year deal for uniform

The Merchandise Ticket: –Even before playing in a single Major Soccer League game, more than 300,000 official LA Galaxy jerseys were sold. At $79.99 a pop, those initial sales totaled almost $24 million. –Beckham’s track record for merchandise: During the four years that Beckham played for Real Madrid, the Spanish club more than doubled soccer merchandise sales to US$600 million. One million Beckham-Real Madrid shirts were sold within the first 6 months of Beckham’s arrival (Source: Forbes).

In sum: LA Galaxy generated about $23m in additional revenue from the Beckham effect. A good deal despite a $6.5m annual salary!

How do you explain the Beckham Economics?

The Olympics Games: Center of Attention

Who are the ‘Top 12 Olympic Sponsors’ (“Olympic Partners”)? Atos Origin Coca-Cola General Electric Manulife Johnson & Johnson Kodak Lenovo McDonald’s Omega (Swatch Group) Panasonic Samsung Visa

$70 million for Coke About $5 to $15 million sponsoring the torch relay All together about $900 million.

Is this ‘play’ paying off? In your groups, –Choose a sponsor form the list –you have 10 minutes to research if there is evidence for ROI or not. –You will get 5 minutes to present: Rationale for your sponsor to become Olympic Partner. Was it worth it? Why/why not?