In the inaugural Wharton Sports Business Summit, a panel of seasoned professionals sponsored by Victus Advisors spoke on Collegiate Athletics. From innovating collegiate revenue streams to the evolution of merchandise distribution, moderator George Perry, the Chief Revenue Officer of Penn Sports Properties at JMI Sports, prompted discussion on a wide scope of topics which consume the minds of athletic departments across the country.
To begin, the Vice President of Collegiate Services at Van Wagner Sports and Entertainment, Mike Palisi dove into the evolution of the fan experience. He noted that managing stadiums used to be as simple as getting fans in and out of their seats, but now there is a growing market for the “ultimate fan experience.” Booth seats are becoming more obsolete as top ticket owners want to be closer to the action. This demand has prompted stadiums to provide private sections near or on the field so that these prime ticket holders can be engulfed by the game. Irwin Raji, Sports Industry Group Co-Chair at O’Melveny, added that even advertisement boards are being renovated to provide new streams of income. A transition from static boards to digital boards has been the main source of revenue streams which enables stadiums to not only include more advertisement slots, but also modernizes the stadiums themselves. Penn alum and Senior Associate at Victus Advisors, Brandon Bagley, confirmed that this change is not just happening at the top tier athletic schools; in fact, almost every major university has utilized this technology in order to gain access to these new revenues.
Providing the best fan experience is about more than just the seating, it is also the about talent on the field. Palisi emphasized that schools are fighting for the best players so that these young athletes can excite fans and better yet prompt more school merchandise sales. This increased profit permits for the few lucky colleges to upgrade their facilities which attracts better talent. In this sense, the rich keep on getting richer, while the other schools lag behind. This is a cyclical conundrum which has widened the gap between Power Five conference schools and the rest. Adding to the debate about the dominance of the athletically elite schools, Vice President of Marketing at Fanatics, Ryan Donovan, reaffirmed that the top schools reap the most benefits from a merchandise standpoint since the brand name schools facilitated the most online traffic. He pointed out that his company, Fanatics, has long established relations with such schools, however schools like the University of Pennsylvania struggle to make such deals since there simply is not enough demand for Quaker sports merchandise.
With millions of dollars in collegiate merchandising and media, the mission to educate students is often lost, as Palisi claims. While each institution is different, it is important to always keep the mission of the school at the head of discussion. For some schools, profitability is their driving factor, but for the vast majority of schools, the mission is to education students, helping to create successful, young professionals. This panel was a thoroughly educational discourse on how colleges are obtaining new revenue streams and how schools balance their academic mission with their athletic goals.
USBC Journal Writer
Class of 2021