The world of sports is by itself a very profitable business. The money that is involved in that sector is too much to count it all, especially because there is a lot of unaccounted ones. How and where does this money all come from? Well, the sources are probably very different in many cases in different sports. We all heard that Florentino Perez, the president of Real Madrid, got his money from a bank loan, now during his second reign at Madrid. We also have a situation where the club is a joint stock company, where a bunch of people, usually the fans, have a possession in the club based on the stocks. The money is available through them. On the other hand, we can have a club owned by a private owner, like the Glazer family in Manchester united. Or the club can be supported by the city or state it is located in. These are a few common situations in sports.
But really, where most of the money comes from, or at least a great deal of it, is from advertising. Because so many people watch and follow sports, this is a great way to reach the masses, with ads, without the people even knowing. Say you are watching a game on television, any game, because they all have breaks. During these breaks the commercials will be on. You see these commercials even though you were actually watching something else, and maybe you don’t want to see these commercials but you do not have a choice. You can also see advertisements on all sorts of different places during the game, for example on the billboards outside of the football pitch, on players jerseys etc. The companies that buy the advertising time during a sports transmission are willing to pay a lot of money to reach the people who are watching it. That is why there is so much money involved in this, because they know the kind of people who are watching each sport event, and they want to reach them with their ads. Of course, this is not only limited to television, this is also highly effective on radio, and of course, on the internet.
This is where the real problem starts. Some say that making money has become much more important in sports than winning the actual contest that is held. This is a fair argument, because once the advertising industry during sporting events began growing, sports had to adapt to follow it and to target a more specified and larger number of people. For instance, baseball in America was usually played in the afternoon, but had to adapt to the demand of the advertisers and is now usually played in the evening. Sports like hockey and handball have timeouts to have a discussion about strategy, but also to make a television commercial break.
Not only are ads on the television or radio during a sport transmission, but they are also on all sorts of sporting facilities and equipment. Teams move from their old stadiums to new one who bear the name of their sponsor (Arsenal moving from Highbury to the Emirates Stadium, Bayern plays on the Allianz Arena). This is of course to help the clubs in a financial way, because they usually sign a huge sponsor contract and get a lot of money for it. Not even the mighty Barcelona, one of the greatest clubs in the world, could resist the global financial instability that is present in the world. They just signed a deal with a Qatar foundation worth 30m euros. Up till now they avoided having sponsors on their jerseys, with the exception of UNICEF which did not fund them.
So basically, ads are and will probably be an important part of sports. They bring so much money to different clubs and sport organizations that it is hard to say no to them, especially in these hard times when sports are really struck.