A few months ago I jotted some notes down about why gate revenues were declining at sporting events across the United States.
The conclusion is simple: anyone can have the "best seat in the house" by watching a game from the comfort of their home.
And it's not just one game. Thanks to streaming and league passes, anyone can watch multiple games from a variety of sports at the same time.
You can basically have the control center for ESPN set up in your living room. On the television, you have the primary game you're watching. You could stream secondary games on one or more laptops. And if that isn't enough, you can receive live updates via your phone.
Sensory overload? Perhaps.
But this is how your savvy sports fan - especially the ones who gamble - watch games in 2019. And you can bet this trend continues into 2020 and beyond.
To be fair there are other factors that have contributed to the reasons why fans won't show up to a ball game. Ticket prices, conflicting schedules, concession prices, parking, and other factors play a part.
According to a recent PWC report, gate revenues are set to level off - others have predicted these numbers have the potential to decrease in certain sports. This is why you saw a few teams in major league baseball come up with flexible ticket packages to get more butts in seats at the ballparks.
While that stream of revenue hits a plateau, sponsorship will continue to flourish. According to that same PWC report, sports sponsorship in North America is set to grow 3.8 percent annually year-over-year in the next five years.
If their projections are correct, there will be over $17 billion in revenue from sponsorship in 2019. PWC projects sponsorship revenue in 2023 will be around $20.6 billion.
Gate revenues are projected to be $19.1 billion in 2019 and only grown 2.5 percent YoY to an estimated $21.7 billion in 2023.
PWC sited that new inventory and sponsorship activations will play a part in this area's growth. Things like: jersey sponsorships, gambling partners, and digital media platforms.
Personally, there is a chance this revenue stream exceeds that 3.8 percent growth rate. An increase in streaming partners over the next five years could inflate the price of sponsorship assets.
Additionally, new inventory activations like virtual signage - in both traditional sports and esports - could create a seamless and new integration for brands who didn't purchase physical signage within a given arena.