Show me the money

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Show me the money

This is sponsored content for Swinburne Online

When it comes to the big bucks, there’s no business like sports business - with as much high stakes action in the boardroom as on the field, pitch and court.

By the time the Australian Open Men’s Final concludes this country’s annual January feast of tennis, an extraordinary amount of money will have changed hands – on and off the court.

First, there’s the prize haul. The 2019 Open offers a total pool of $62.5 million to the best of the world’s top 100 men and top 100 women, with $4.5 million each for the men’s and women’s singles champions. The consolation for second place, still more than two million, must surely ease the pain of defeat.

If you’re tuning into any of the Open matches live, consider that it’s costing Nine a cool $60 million a year to share the action with you. To wrest that exclusive privilege from its Seven rivals, the entertainment network had to bring a whopping $348.5 million to the table for the next five years.

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When it comes to personal fortunes, the numbers continue to amaze. World champion Roger Federer’s net worth is estimated at about $630 million, Serena Williams’ at $260 million and Rafael Nadal’s around $252 million.

That’s just tennis. Once you’re talking football, those amounts seem positively petite. The most lucrative of all the blockbuster sports broadcasting contracts worldwide belongs to the American NFL, which rakes in a total $6.31 billion a year from four US networks. The NFL also boasts the world’s richest sports team, according to Forbes magazine; the Dallas Cowboys, with a value of $6.3 billion, closely followed by soccer teams Manchester United, Real Madrid and Barcelona.

Sport can make fortunes for its titans, whether they perform in a stadium or boardroom. Basketball legend Michael Jordan’s estimated $1.96 billion net worth has him firmly positioned on the Forbes rich list. But his stash is dwarfed by the estimated $33.2 billion net worth of former Microsoft CEO Steve Ballmer, who snapped up the L.A. Clippers basketball team in 2014 for $2.8 billion. No wonder the aptly named Ballmer takes to the court at halftime, grinning, to shoot hoops. In the world of business athletes, he’s got all the gold medals.

For further proof that sport money makes the world go round, consider the billion dollar values of global sports brands such as Nike, Adidas, ESPN and UFC, the cashed-up gambling industry and the hefty endorsements for top athletes. Thanks to exponential growth driven by technology and the vast online audiences it enables, all the numbers are trending steeply upward.

Bill Mulvihill, Vice President at major sports lender US Bank, recently said: “As the economic opportunities in sports explode, the sophistication of how teams drive revenue and extend their brand has never been higher. We are watching sports transform from just a game to a media and technology juggernaut.” The product is athletes, and it’s their role that has changed as dramatically as the industry around them. Once required simply to win, they’re now groomed to become business empires. A great coach to hone your game is no longer enough; a skilled manager to build your value outside the game can be even more important.

A good manager treats each client as a brand, says W Sports & Media’s David Drysdale, who manages several elite Australian sportspeople including tennis legend Lleyton Hewitt and dazzling young tennis talent Alex de Minaur, who has risen from 208 to 31st in the world in just over a year.

De Minaur’s success has already brought him a taste of sport’s lucre; Drysdale recently secured sponsorship contracts for him with Tag Heuer and Swisse.

Such partnerships are as valuable as trophies, says Drysdale - and can be even harder to win. “Sponsorship is much tougher than it used to be; there are so many sports and entertainment personalities to choose from, and now sponsors determine the exact qualities they want. They used to sponsor just to get recognition of their names and now they want much more. Managers have had to really lift their game.”

A marketable personal brand takes more than talent, Drysdale says. “I’m fortunate because I’ve got a good product in Alex and that means talent, character, personality and how he’s seen by other people. Alex is known for giving it everything on court, but off-court he’s a nice, sociable, family-orientated young man.”

The digital age, notes Drysdale, is both blessing and curse for his charges. While digital platforms and social media bring the vast audiences that flood sports with money, they can also present challenges when it comes to brand building.

“The introduction of social media has made it more demanding on the players,” he says. “Everything is more instant and everyone’s got phones with cameras. In the old days the guys could go and have a drink in a pub and a bit of fun, but kids can’t risk that today. While social media can help their success in some ways, in others it means they can’t lead a normal teenager’s life.”

But he also believes his first client, Lleyton Hewitt, could have benefitted from some digital brand building earlier in his career, when social media was still in its infancy. “People had a perception of him without knowing the real Lleyton. There was work to be done. He’s always been a great kid, so it was just a matter of people getting to know him – he was a very shy sort of guy so it wasn’t easy without social media providing that access to him.”

Some might argue that the nice guys don't necessarily come first. Despite his controversial antics, tennis’s Aussie ‘bad boy’ Nick Kyrgios has a hefty line-up of sponsors, including Nike, Beats and Yonex (although Bonds distanced themselves from him after his particularly fiery 2015). With a net worth estimated at more than $14 million, he’s perhaps living proof that any publicity’s good publicity.

Only time will tell if sponsors will back Kyrgios for the long haul that David Drysdale says is crucial for an athlete’s true business success, but one thing’s certain: for anyone involved in the business of sport, the glittering rewards have never been higher.

Want to be a leader in sports management? Swinburne Online offers a Sports Management business degree, delivered by industry professionals in a dynamic online learning environment. So you can balance your love of sport with your studies. Discover the range of business degrees on offer to help you reach the pinnacle of your career.

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