The Growing Relationship between Sports and Big Business
For a long time in history, sporting has been taken as a social event. Sports have been in existence for many years. As it is today, the magnitude and scale of sport in the society is growing with the growth in the number of sports and sporting events globally. While the social aspect of sports has become significant, there has been a shift in the way people view sports. Sports are no longer viewed from the social inclination but are seen as probable commercial activities. Sports are being considered as a business just like any other formal business. The reason behind this is that unlike in the early times, the earnings made from sports and sport-related activities have tremendously grown. However, many other people consider sports to be non-profit oriented events they do not equate sports to business. Therefore, a gap exists between people who perceive that sporting events as a business industry, which is becoming commercialized and those who think that sports should not be commercialized. For this gap to be filled there has to be an understanding of the contribution and benefit of sports in global economies. This is what will inform on whether sports should be considered to be businesses and operated like commercial activities.
Objectives of the research
The main objective of this research is to gather supportive data and literature in two categories. The data supporting that sport are commercial activities and any data which holds that sports are not commercial events and should not be treated as large businesses. The second objective is to get examples of sports and sporting activities which can be treated as large businesses in the way they are being managed. The third objective is to understand the impact of sports in economies.
According to Mason (1999), sports and sporting events have been in existent for a long time and have been fulfilling the main goal of bringing people to together. They have been used as social events. However, from the last half of the 20th century, the number of sports and sporting events and activities has been on the rise. During this period, there have been bigger prize tags in sports with the winning teams getting monetary gains besides the trophies (Carenys & Sales, 2012). Unlike in the ancient times, sports are becoming highly structured as opposed to ancient sports, which were less structured. They were more or less of spontaneous activities. As it is now, sports and sporting activities are taken seriously because sports are conducted according to set plans and take place as per the schedules set in the plans. At local levels in most communities, sports are still seen as social events, which are aimed at promoting interactions by bringing different people together (Giannoulakis & Apostolopoulou, 2011).
Sports have become an income earner not only to the direct participants but also to the whole chain of people involved in organizing for the sports. Sports are organized with the aim of generating income for the organizers. This is called the commercialization of sports. In the commercialization of sports, sports are treated like any other business with profit outcomes expected. The number of sporting clubs is growing in different sports. For example, in football there are big footballing clubs in Europe controlling vast assets. In the United States, there are famous basketball clubs that have substantive assets. Research is pointing out that sports have become commercial activities. From the leading sporting clubs in the world to mega sporting events, lots of revenues are collected, and lots of money are exchanged (Herstein & Jaffe, 2008).
Sporting activities and events generates lots of money in economies. They boost different business sectors in economies; for instance, the tourism sector. This is the reason why they are treated like successful businesses. The social objective of sports cannot be ignored. Sports also fulfill this objective. However, this role of sport has been dominated by the commercial benefits of sports. Sports are more inclined to business rather than to social development (Adcroft & Teckman, 2009). Research reveals that aspect of management in sport is being emphasized because of the gains that are derived from sports. Management in sports aims at bringing better practices; business-like, so that the gains can be maximized. More research has been directed in the area of sport management. However, people fail to focus on the commercial worth of sports and to what extent sports can be termed as business activities (Burnes & O’Donnell, 2011).
This research seeks to establish the worthiness of sports in the economy, and why sport should be considered as business and not just social events. In investigating this topic, literature will be collected from diverse resources and posted in the literature review section. This literature will be used as a source from which inferences or conclusion will be done. After the literature has been collected, it will be discussed and analyzed in relation to the topic of investigation. This will form the discussion and analysis part of this paper. This part will try to link the literature and facts therein to the topic. The conclusion and recommendations part will then follow. Main point that will feature in the analysis part will be codded into facts either supporting or confirming the topic under investigation. Basing on the gaps existing, recommendations will be given as direction for future research.
This is an essential part of this research which is aimed at giving the real facts about the topic being investigated. This part will be subdivided into different subtopics in order to give a broad room of understanding the relationship between sports and business. The literature will be arranged in a developmental manner so that it can give a clear picture of the relationship between sports and business. The subtopics under literature will be: the history of sports and sporting event, the commercialization of sports, the role of sports in the modern economy and sports as businesses.
The history of sports
Sports are events which have existed for many years. It is evident that the way sports were viewed in ancient times is not the way they are viewed today. The role and contribution of sports in society has been changing with time; from the basic role of socializing to more complex and beneficial roles (Giannoulakis & Apostolopoulou, 2011). The history of sport is expected to give a clear picture of the role of sports from the development perspective. The role of sports from the ancient times up to date will be carried in this literature. The history will also reveal the changing role of sports and the reasons why there is this change. This literature will be attained in a summary form. Only key points in history will be extracted for different resource materials and included in this part of literature.
Commercialization of sports
Research has shown that the role of sports has changed in the last three decades. Sports have been shifted from being social events to commercial activities to business due to commercialization. Commercialization has made sporting organizations and managers become more concerned with the principles of business. Business principles have become core in the management of sporting organizations and sporting events. Therefore, sporting organizations are being described as business organizations because of the business dimension taken in managing sports (Carenys & Sales, 2012).
Under this part, literature will be collected basing on two perspectives. The first part of the literature here will show the indications of commercialization of sporting activities. This literature will be focused on different sports and sporting organization and activities that they are doing which denote that sports are commercial activities. Income and expenditure in sports will be given preference here as this is what denotes commercial activities. Also, different deals and agreements made in sports organizations will be carried in this literature. Many other examples and reports of business-like deals made in sports will be contained in this literature.
The second part of literature on commercialization of sports will focus on state sports departments or non-profit-making oriented sporting organizations. The approaches of management of these departments or organization will be featured to ascertain how they manage to sustain their activities. The literature will link the decisions that are made in these organizations to those decisions that are made in business organizations.
The role and contribution of sports in the modern economy
As opposed to ancient sports and sporting events, sports have been applauded in the modern world economy. Sports make both direct and indirect contribution to the economy. Sports are being treated like other businesses because they are making a significant contribution to economic growth and development of national and international economies. Huge sums of money are being pumped in sporting infrastructure development. The outcome of this investment is reflected in different sectors in the economy like tourism, hospitality among others (Carenys & Sales, 2012).
This section of literature review will carry the outcomes of different cases that relate sports to the economy. The literature will look into different cases of how sports are related to economic growth. Things like investments made in sports, the revenues earned from different sports and sporting activities will be discussed. The literature will carry many examples of different sports and sporting organizations as well as events and their outcomes related to economic growth. Spots which are considered to have many supporters will be given more consideration when seeking for literature here. These sports will include football, basketball, and athletics. Views will be combines with different research cases and reports to give comprehensive data.
Sports as business
Sporting organizations are being run using the principles of running businesses. They also control vast revenues and control large budgets. These organizations are found at the international as well as national levels. They also have many assets and many continue to invest in different sectors like the hotel sectors. These organizations deal in the same activities like many business organizations; with many having assets that outweigh the assets of the so called giant multinationals. The assets and revenues of the leading football clubs in Europe are excellent examples (Giannoulakis & Apostolopoulou, 2011).
This will be the last part or sub-topic under literature review. This literature will seek to gain insights on whether sports are considered as businesses and to what level. Sporting clubs and organizations, which have excelled, will be the main focus. The literature will relate how the organizations run their activities to the operations of successful multinationals. The objective of this literature will be to relate sports organizations to business organizations so as to justify whether sports can be run as real businesses.
Discussion and analysis
This part will look into all the literature that will have been collected in the literature review. The literature will be assessed basing on the objectives of this research. Each part of the literature review has its significance to the objectives of the research which will also be reflected in the outcomes of this research. The data in the literature will be assessed in an analytical sense by narrowing the look into the objectives of this research. The analysis will come up with key stands or findings from literature and relate them to the problem being investigated.
Conclusion, Recommendations and outcomes
This is the last part of this research which will put the problem under investigation to rest by giving the outcomes of this research. The outcomes of this research will be based on the analysis of the literature. The conclusion will be reached basing on the points that will prop up from the analysis. The conclusion will put to rest the matter under investigation which is whether or not sports are large businesses. Under this section, areas that offer potential for more research will be highlighted.
Adcroft, A., & Teckman, J. (2009) “Taking sport seriously”, Management Decision, 47(1), 5-13.
Burnes, B., & O’Donnell, H. (2011) “What can business leaders learn from sport?”, Sport, Business and Management: An International Journal, 1(1), 12 – 27.
Carenys, J., & Sales, X. (2012) “Tailoring performance management systems: A sports merchandiser’s case”, Sport, Business and Management: An International Journal, 2(2), 1-45.
Giannoulakis, C., & Apostolopoulou, A. (2011) “Implementation of a multi-brand strategy in action sports”, Journal of Product & Brand Management, 20(3), 171 – 181.
Herstein, R., & Jaffe, E. D. (2008) “Sport hospitality as a business strategy”, Journal of Business Strategy, 29(6), 36 – 43.
Mason, D. S. (1999) “What is the sports product and who buys it? The marketing of professional sports leagues”, European Journal of Marketing, 33(3/4), 402 – 419.
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