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The Business of the College Football Bowl Season

By Rick Horrow and Karla Swatek

December 6, 2012

Beginning on December 15, the bowl season begins – over 23 days, with 35 games, 70 teams, 1,400 television hours, 16 states, with over $280 million in payouts to the participating schools and conferences, and a regional economic impact of well over $1.7 billion.

1. How did we get to where we are?

Big names today, less so in two years: Anderson & Hester; Richard Billingsley; Colley Matrix; Kenneth Massey; Jeff Sagarin; and Peter Wolfe. Those six computer programs comprise the Computer Rankings Percentage. Last year the Louisiana State-Alabama selection formula was the closest ever (86-thousandths of a point). This year, Notre Dame vs. the “SEC Southeast semifinal.” The selection two years from now will be handled by a “March Madness-like super committee.” The more things change, the more they remain the same.

We think we have controversy now: the writers and coaches have been voting for the respective national champion since 1954, and there has been a “split vote co-champion” 11 times. The national championship vote was split between the coaches and writers 11 times since they began voting for the national champion in 1954. The Bowl Coalition began in 1992, and the Bowl Alliance attempted to improve that system three years later. The current Bowl Championship Series had its beginning in 1998. Ironically, the Swiss conglomerate ISL proposed a 16-team college football playoff around that time. Colleges immediately rejected the proposal, though the $350 million annual payout would have been twice the amount paid for each of the first 10 years since the beginning of the BCS.

2. Is it “mediocrity” or is it “parity” for this year’s bowl games?

Yes. The 35 bowls and 70 teams reflect college football scholarship parity, but also some interesting matchups. This year’s 70 teams have a total record of 584-267; last year was 273 total losses; 257 the year before). There are 12 teams at 6-6 this year, compared to 12 last year. Overall, 28 of the 70 teams have five or more losses. Georgia Tech (6-7) plays Southern California (7-5) on December 31 at the El Paso Sun Bowl (the only CBS game). There have been four other teams who have gone to bowls with losing records: UCLA last year; 5-6 Troy State in 2001; 4-6 SMU in 1963; and 5-6 Williams & Mary in 1970. Here’s a bowl “blockbuster”: 6-6 Pittsburgh vs. 6-6 Mississippi in the BBVA Compass Bowl (January 5 in Birmingham) – at least it is only two days removed from the BCS National Championship.

3. What about corporate involvement this year?

Three bowls this year have new corporate partners. What was the Champs Sports Bowl in Orlando is now the Russell Athletics Bowl, featuring Rutgers and Virginia Tech. Tempe’s Insight Bowl is now the Buffalo Wild Wings Bowl with Michigan State and TCU. Finally, the three-year-old TicketCity Bowl has partnered with PlainsCapital Bank and is going by the name Heart of Dallas Bowl. This year, 12 corporations “hijacked” the bowl name, replacing it with their own (Beef O’Bradys, Belk, Chick-fil-A, for example). The following is an industry breakdown of bowl game title sponsorships:

Industry Breakdown

Consumer Goods: 9

Financial Services: 9

Restaurants: 5

Auto: 3

Aerospace/Defense: 2

4. How do the 35 bowls help regional tourism, etc.?
3 games in current MLB stadiums*
15 games in current NFL stadiums
8 games in markets without a pro team
10 games in stadiums w/ CFB as primary tenant

*Last year, there were 4 games in baseball stadiums, but the Marlins moved out of Sun Life Stadium

Overall, 16 states (including the District of Columbia) have become directly financially involved in supporting their bowls, understanding that over $1.75 billion in economic impact is generated by the respective regions. Florida leads the way with seven; Texas has six; California has four; Louisiana three; Alabama, Arizona, and Tennessee with two each; New Mexico, Idaho, Nevada, New York, North Carolina, Michigan, District of Columbia, and Georgia with one each.

5. How do the conferences and schools fare this year?

Very well. Overall, the 35 bowls pay a total of over $280 million to conferences (who distribute the revenues based on their own individual formulas). This compares to approximately $281 million last year. As for the BCS games, their payouts approximate $192 million.

6. In summary, are there too many bowls?

Absolutely not. Cynics argue that the “niche bowls” serve little “useful purpose.” They ignore the big picture in four ways:

First, the 35 bowls produce 70 schools with an opportunity to participate in the post-season at a significant level. Overall, nearly half the Division I teams have the privilege of participating in post-season bowl games, a far greater percentage than the approximately 20 percent that are selected in the NCAA championships in other sports (22 percent in baseball; 20 percent in men’s and women’s basketball; and 24 percent in men’s soccer).

Second, as for television, Scarborough Research initially reported three years ago that adult bowl game viewers are among the most prolific buyers – 20 percent more likely to bank online, and 28 percent more likely to have a money market account. Given this, get set for over 1,400 hours of bowl coverage this year.

Third, Corporate America loves the exposure. Joyce Julius & Associates consistently reports that bowl titles are among the most successful corporate investments through a sports calendar year. The last time the national championship was played in Miami, FedEx enjoyed nearly $256 million worth of exposure as part of its national championship. As Corporate America spends at least $7.2 billion to pay for sports tie-ins of all kinds, bowl titles potentially offer the most efficient and effective buy.

Finally, the economic impact for the host region is significant. The UCLA Anderson School of Management suggested that the Rose Bowl and Tournament of Roses Parade impact exceeds $200 million annually. The other regions across the country experience at least a $50-$60 million impact from their respective weeklong festivities. At a minimum, at least $1.7 billion of economic “stimulus” impact from 35 “major events” around the country from December 15 through January 7 – Let the Games Begin!

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Beyond the Scoreboard
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.
Beyond the Scoreboard eBook
Rick Horrow, America’s leading expert in sport business, and coauthor Karla Swatek give fans an inside look at the multibillion-dollar world of professional sport.
Beyond the Scoreboard: Chapter 1. The Mega-Master Super Series XLXL eBook chapter

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