Monday night, Florida State hoisted the crystal football in the middle of the Rose Bowl, and it was just the beginning of the good times for the new national champions. There is no direct financial gain from winning a national title in college football – the winner makes no more than the loser since BCS money is largely based on conference affiliation – but studies and experience tell us there will be much indirect gain for Florida State in the coming months and years.
Rewards programs are not new. Whether for pumping gas, swiping your credit card or booking a flight, companies have long sought to incentivize consumer loyalty. Think about it: between commercials, people in booths at the airport and internet pop-up ads, rewards programs are becoming ubiquitous.
College athletics fan rewards programs, where athletics departments give out prizes based on attendance at various sporting events, are also nothing new. Recently, a new trend has developed in this arena, one that seeks to combine the rewards concept with social media. Social media fan rewards programs have been popping up around the country, including schools like Oregon, Florida State, Duke and Penn State, among many others.
The premise is simple: fans are already interacting via social media outlets like Facebook, Twitter, Foursquare and Instagram, often immediately before, during and immediately after athletic contests. Schools utilizing this technology are now providing a platform for fans that makes it easy for them to interact and engage (and spread the good word of the athletics department), while also garnering points to be used for free swag (and who doesn’t like free swag?).
One of the earliest adopters of these programs was Baylor, whose Baylor Bold Rewards program kicked off at the beginning of the 2011 academic year. At the time Associate AD John Garrison stated that, “With so much of our communication moving to social media, we felt this rewards program would be the way to get beyond our ‘friends’ to our friends’ friends.” The program has generated over 22 million social media impressions over the course of a year. That ability to expand a fan base is a big reason these programs have themselves gone “viral”. It’s about rewarding fans for spreading your message about your brand to their friends. Now, not only are more and more schools getting into the act, but conferences are as well, with the Big Ten Network, Horizon League and SWAC all launching their own iterations recently.
Two of the leaders in this burgeoning industry are Row 27 and Lodestone Social. Row 27 was responsible for Baylor’s groundbreaking program and also offers a number of other social marketing tools through their Fanmaker App Suite. Each company boasts long lists of clients from major programs, and each promises to galvanize a fan base through social media while dangling the carrot of the potential monetization of those social media initiatives. Lodestone Social’s pitch is to, “unite the void between social media efforts and revenue, connecting the passion of the crowd to the power of your team.”
One recent example of this “unity” is when Ole Miss and Mississippi State jointly announced in September that C Spire Wireless had signed on to become the official wireless partner of the universities’ social media rewards programs. The sponsorship will allow fans who participate in the Ole Miss Social Rebels and Hail State Social Rewards programs to interact with C Spire Wireless and earn additional rewards and giveaways, and also allow both universities to better engage their fans during games through their smart phones. It is believed to be the first program of its kind in the country, but is not the only way to make money from social media efforts. For example, in 2011 the University of Michigan made $376,478 in revenue from Facebook referrals alone.
Not everyone is impressed with social media fan rewards programs, however. A recent post on the digital and social media blog Digital Hoops Blast questioned if social media rewards programs are necessary at all. The three arguments made to support this notion are: 1) that these programs cause schools to lose focus on creating and sharing amazing content by focusing instead on points, 2) these programs dictate what social networks are better for fans to engage in by skewing the point scheme (more for a like on Facebook than a retweet on Twitter for example), and 3) the automation that totals up points to decide who your best fans is impersonal, which is counterintuitive to how you would want to connect with your best fans.
Those are great points but ultimately these programs are not going to go away. If Michigan, Ole Miss and Mississippi State were able to monetize their social media efforts, you can bet others across the nation with similar or even larger social media footprints are in the process of forming similar partnerships. Rather than the latest tech trend these programs appear to be an extension of what athletics departments have been doing with “traditional” fan rewards programs for years. For this reason look for companies like Lodestone Social, Row27 and others to continue to saturate the market, and for a social rewards program to come to a university near you (if it hasn’t already happened).
As I continue to write about the financial aspect of college athletics, I find myself wondering about things like how much money plays a role in winning. Is there one place where you can spend more money and increase your odds of competing for a championship? Or is the Athletic Director more of a conductor choosing which instruments to highlight and when in order to produce the best sounding symphony?
I thought it would be interesting to see how much spending on recruiting plays a role in football success. The numbers reflect recruiting expenses for the 2009-2010 school year.
One thing to note is that recruiting dollars are not broken down by sport, so the numbers you see below reflect the total amount spent on recruiting for all male athletes. Since football has the largest recruiting class and we can safely presume most schools spend the majority of their recruiting dollars on football, I think the numbers still paint an interesting picture.
Below you will see recruiting dollars spent during the 2009-2010 school year for each school in the 2010 BCS final standings, when presumably the athletes recruited with 2009-2010 dollars were then members of the team:
|School||Recruiting Expenses||% of Total Expenses|
Boise State is spending the paltry sum of $158,355, which is just 25% of the average. Only 26 of the 115 on the Broncos 2010 roster hailed from Idaho, with a huge percentage coming from as far away as California and Texas. Impressive that Boise State recruits so well on such a limited budget.
As an interesting side note, Boise State spends nearly as much on female recruiting as male, with female recruiting costs coming in at $123,287. That’s 44% of the total recruiting expenditures. Compare that to the leader for male recruiting expenses on this chart, Alabama, who only spends 26% of their recruiting expenditures on female recruiting. To complete the data needed for comparison, Alabama has 10 women’s teams and Boise State has 9 (with all track-related sports combined into one in each total).
The other thing that stood out to me was that Utah spent above average in terms of the percent of their total expenses advanced towards recruiting. In fact, they rank fourth overall in terms of percentage of total expenses spent on male recruiting. I was also surprised to see Ohio State and Michigan State from the Big Ten spending so much less than Alabama, Arkansas and Auburn from the SEC. The latter three make up the top three spenders overall on the list. Did this help them in their quest to move from a non-AQ conference to an AQ conference?
What surprised you from this list? If your school is on this list, how do you feel about what’s being spent on recruiting?
After writing about the football finances of the SEC and Big Ten, it’s the ACC’s turn. The numbers are drawn from schools’ reports to the U.S. Department of Education on the state of their athletic departments’ finances for July 1, 2009 to June 30, 2010. See the note at the end for more details on the data.
I don’t think the schools on top of the revenue list in the ACC will surprise anyone:
|Univ. of Miami||$24,631,029.00|
|Univ. of North Carolina||$22,077,550.00|
|North Carolina State||$22,018,738.00|
|Univ. of Virginia||$19,004,653.00|
|Florida State Univ.||$18,958,861.00|
|Univ. of Maryland||$11,540,368.00|
|Wake Forest University||$10,227,922.00|
I also don’t think you’ll be surprised to hear that the average revenue in the ACC ($21m) is less than half that of the SEC ($50m) and only slightly better than half that of the Big Ten ($41m). Continue reading ACC Football No Cash Cow