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Living in the town where the main campus of The University of Virginia is situated, about every two weeks each Fall, I get to see first-hand how the city morphs in preparation for a UVA Cavalier’s home football game. The hotels book up, the restaurants fill to the brim, there are more people walking around campus, and the main roads in and out of town become a little more cumbersome to transverse.
Event though I personally do not attend the majority of the home football games, I actually do enjoy the atmosphere and the excitement that manifests in town for the games (provided that I don’t get stuck in too much of the traffic). It’s pretty fascinating to have so many different types of people interested in the common theme of the college football game for that one weekend. It feels like it’s really a way to bring people together more.
During a recent home football game, I began to wonder how much money changes hands as a result of a big (Division I) college football game? However, in searching through my head for an answer for this, I really had no concrete idea. As such, the purpose of this post will be to try to find a numerical answer to this football-financials question!
Before searching around the Internet for existing statistics, I figured I would do a few rough calculations and come up with a few college football game financial stats of my own. These are listed below:
- Ticket Sales
- Assume a 70,000 person stadium and an average ticket price of $30.
- Total ticket sales revenue = $2.1 million per game.
- Concession Sales
- Assume each of the 70,000 people in the stadium purchases $3 of concessions.
- Total concession sales revenue = $210,000 per game.
- Parking Passes/Donations
- At both of the colleges I have attended (University of Virginia and University of Arkansas), you had to donate $5,000 or above in order to have the privilege of spending the $500 to purchase a season-long parking pass to do your tailgating for the home college football games.
- Assume that there are a total of 3,000 of these ‘preferred’ parking spaces on campus for each home game.
- Total parking pass and donation revenue = 3,000 x ($5,000 + $500) = $16.5 million per year.
- Hotel Revenue for Local Economy
- Assume half of 70,000 people in stadium come from out of town to watch game = 35,000 people.
- Of these 35,000 people, assume half decide to spend the night and get a hotel room either the night before of night after a game = 17,500 people in hotel rooms for game.
- Assume 2 people per hotel room @ $100 cost per hotel room per night.
- Total hotel revenue = $100 x 8,750 rooms = $875,000 per game.
- Restaurant Revenue for Local Economy
- Assume 35,000 people from out of town eat 3 meals in town for the game at an average of $10 per meal.
- Total restaurant revenue = 35,000 people x 3 meals x $10 per meal = $1.05 million per game.
Total Economic Impact Per College Football Home Game = $6.3 million per home game. (This assumes 8 home football games per year.)
Literature Search – Financials of a College Football Game
Having generated some rough statistics based on my personal experiences with college football games, I then ventured off to the Internet to find what numbers already existed on this same subject.
Interestingly, when I did a Google search for “college football game financials,” there was quite a bit of information that popped up about the direct revenue/expenses that arise from college football games as well as the impact on the local economy.
Listed below is a summary of the findings I uncovered:
- A University of Arizona study estimated that a home football game brought in $8.3 million in economic impact to the local Tucson economy. Another Utah study found that home games brought in an economic impact of $5.5 million.
- Amazingly, this isn’t too far off from the quick calculation I did above! haha
- ESPN.com maintains a very extensive listing of the total revenue and expenses for college football programs from the years 2008-2011.
- According to the 2010 stats, Texas has the top ticket sales ($45 million), Michigan State is paid the most to play away games ($4 million), Alabama has the biggest yearly program budget at $123.7 million, and Texas spends the most on coaches pay at almost $18 million per year. (Source)
- Home games against very small, no-name teams often bring in just as much revenue as playing home games with bigger opponents, but come with much lower expenses, boosting overall profits.
- If the University of Texas football program were to be valued like a business, it would be worth almost $850 million.
- SEC conference football games bring in by far the most money, bringing in an average profit of almost $30 million per year.
- An academic study from Holy Cross University found no statistically significant relationship between a town hosting Division I college football games and a boost in the local economy. In other words, I read this to mean that compared to the normal business throughout the year, any boost that a hotel or restaurant gets during a home football game doesn’t add much in the long run.
- CBS42 news reported that the state of Alabama experiences a yearly economic impact between $350-$500 million because of the games played by Auburn and the University of Alabama.
- In 2009, Penn State football brought $90 million in business to the local State College economy.
- The BCS college championship bowl game brings in about $190 million in business to the local economy.
How about you all? Which of the stats above do you find most surprising and why? Do you think the level of money spent on college football programs is too much or appropriate?
If you live in a college city/town, do the college sports play a significant factor in the local economy?
Share your experiences by commenting below!
***Photo courtesy of http://www.flickr.com/photos/stevendepolo/6224563889/sizes/o/in/photostream/
