Putting butts in seats is a growing problem for football programs at the nation’s major universities. That problem will eventually lead the athletic conference chairs and universities’ boards of regents to one inescapable conclusion: Partnering with sportsbook operators at retail spaces adjacent to or even inside some of college football’s historic and iconic venues.
While that may seem extreme or sacrilegious to some fans, the sport has already crossed similar lines. The same factors will fuel this change as well.
The need for new revenue streams is serious
The practice of adding customer-focused amenities and renovating facilities to whet fans’ appetites for tickets is already widespread in college football. Whether that’s a field-level club that is restricted to 750 dues-paying members at the University of Missouri or the nearly 11,000-square-foot jumbotron on the campus of Auburn University, there’s no slowdown insight of universities spending big to attract fans.
The spending extends to salaries for the coaching staff as well. With performance incentives figured in, football head coaches across the country are collectively accounting for tens of millions of dollars in expenses for universities.
Their staff adds to that, with some assistants now making a million or more in annual salary themselves. Like with the facilities spending, there is no end in sight to how much universities will pay to attract and retain the nation’s best coaches.
Yet, revenue isn’t really keeping up with expenses. Partially, that’s because attendance is down across the board.
Nationwide attendance is at its lowest point in 22 years. That’s the second-biggest source of revenue for university athletic departments and a crucial key to supporting other revenue streams like royalties off merchandise sales.
Because of the severe need to reverse the trend of declining attendance, universities have already changed their tune on one issue. It is just as, if not more, controversial than sports betting.
At college football stadiums, the big news is booze
More and more conferences and universities have rescinded their old bans on alcohol sales at football stadiums. Even as recently as a decade ago, the same people may have railed against it because of a perception that it represented a compromise in morality.
The sales work on a model that should be familiar to fans of sports betting. The universities essentially let their concessions partners, like Aramark for the University of South Carolina, handle all the details then just sit back and collect their share of the revenue.
While broadcast rights contracts continue to escalate in value, there may eventually be a cap to how much a media partner will be willing to pay for such access. Additionally, the more dependent on those rights the conferences and universities are, the more leverage that gives the broadcasters in those negotiations.
The athletic departments need diverse revenue streams. Alcohol sales allow the stadiums to compete with off-campus venues that offer gameday experiences.
Sportsbooks would be another way for stadiums to compete with off-campus venues. They not only could do so, but they inevitably will.
Sports betting will follow the path of alcohol sales
It may take years, much like selling alcohol. But at some point, sponsorship deals between sportsbook operators and athletic departments will spring up. The departments may restrict that to signage in the stadiums and/or in-game activations at first, but those are just precursors to the main event.
Just a decade ago, the idea of a sportsbook inside a stadium where NBA, NHL and WNBA teams play their games would have been unthinkable, but that will soon be a reality at Capital One Arena. In a similar fashion, all signs point toward a sportsbook inside venues like Ann Arbor’s Big House or Ames’ Jack Trice Stadium someday.
College football’s evolution on alcohol sales is proof that when it comes to staying competitive, moral qualms are pushed aside by the almighty dollar. It’s only a matter of time until the same changes are made regarding sports betting.