nep-cul New Economics Papers
on Cultural Economics
Issue of 2018‒07‒09
two papers chosen by
Roberto Zanola
Università degli Studi del Piemonte Orientale

  1. A managerial approach to corporate sports hospitality: The case of Belgian football By BALLIAUW, Matteo; VERLINDEN, Thomas; DE CROOCQ, Lisa; FOBE, Aline; VAN DEN SPIEGEL, Tomas
  2. Unbiased Estimation of Competitive Balance in Sports Leagues with Unbalanced Schedules By Young Hoon Lee; Yongdai Kim; Sara Kim

  1. By: BALLIAUW, Matteo; VERLINDEN, Thomas; DE CROOCQ, Lisa; FOBE, Aline; VAN DEN SPIEGEL, Tomas
    Abstract: Corporate Sports Hospitality (CSH) is a relationship marketing tool whereby customers and other stakeholders are invited by a company buying CSH from a club to attend a sports game. The CSH product involves premium seating and optional services such as catering. Little academic research about the CSH industry has been performed in the past. Moreover, this industry has been perceived to be in decline, especially in times of economic downturn when companies need to justify every cost expenditure. This paper quantifies the added value of CSH. A case study from the highest division in Belgian football (soccer) shows that, although the market is smaller than in the American major sports leagues, CSH returns account for an important share of club revenues. Through Porter’s Five Forces framework, we show that a club experiences the strongest competitive impact from substitutes and other clubs in the league. Since CSH is often managed on an ad-hoc base and the literature offers no formal CSH management process for companies and clubs, information is gathered to build such an effective process. It allows both clubs as well as CSH buying companies to define their objectives and measure their performance in a quantitative way through Key Performance Indicators (KPIs). Not only return on investment, but also return on other objectives matters. We moreover argue that measuring the output through these KPIs and improving the process according to feedback loops are crucial for successful CSH. To improve CSH attractiveness, sufficient attention should be given to technological and managerial innovations.
    Keywords: Luxury seating, Venue revenues, Management process, Sports marketing
    Date: 2018–06
  2. By: Young Hoon Lee (Department of Economics, Sogang University, Seoul); Yongdai Kim (Department of Statistics, Seoul National University); Sara Kim (Department of Statistics, Seoul National University)
    Abstract: Many empirical studies on competitive balance (CB) use the ratio of the actual standard deviation to the idealized standard deviation of win percentages (RSD). This paper suggests that empirical studies that use RSD to compare CB among different leagues are invalid, but that RSD may be used for time-series analysis on CB in a league if there are no changes in season length. When schedules are unbalanced and/or include interleague games, the final winning percentage is a biased estimator of the true win probability. This paper takes a mathematical statistical approach to derive an unbiased estimator of within-season CB that can be applied to not only balanced but also unbalanced schedules. Simulations and empirical applications are also presented.
    Keywords: Competitive Balance, Unbalanced Schedule, Unbiased Estimation
    Date: 2018

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